State 


SECTION 


\ction  2,  VOL.  VI 


'NEW  JERSEY' 


NO.  2,  November,  1918 


Consecutive  No.  13 


eorganization  of  the  New  Jersey  Teachers' 
Pension  and  Retirement  Systems 

Report  of  the 

Pension  and  Retirement  Fund  Commission 

of  the  State  of  New  Jersey  a^s 


•v* 


e 


:% 


Contents 

PAGE 

Part      I.     Present  Systems  and  Their  Reorganization — A  critical  and 

constructive   study  5 

Part  II.  Contents  of  Proposed  Legislation — An  act  providing  for  the 
establishment  of  a  Teachers'  Pension  and  Retirement  Fund 
of  the  State  of  New  Jersey 13 

Part  III.     Actuarial  Estimate  of  Liabilities  of  Existing  Systems  and  of 

Proposed  Plan  17 


BUREAU  OF  STATESRESEARCH 

CLINTON  BUILDING,  NEWARK 


"10    .Vii/=U  ^yi+PP" 

Al:*;!  .••!""!•  '::..:  A  •.•*  NEW         JERSEY' 

Joint  Resolution  No.  3,  Laws  of  1918 
142d  Session  of  the  Legislature  of  the  State  of  New  Jersey 

Approved  February  23,    1918 

Joint  Resolution  for  the  Appointment  of  a  Commission  to  Investigate  the  Subject  of 
Municipal,  County  and  State  Pensions,  and  the  Teachers'  Retirement  Fund  and  the 
Teachers'  Thirty-five  Year  Half  Pay  Pension  Fund. 

Be  it  Resolved  by  the  Senate  and  General  Assembly  of  the  State  of 
New  Jersey: 

1.  That  a  commission  of  five  members  be  appointed,  two  by  the  President 
of  the  Senate  and  three  by  the  Speaker  of  the  House,  to  be  known  as  "The 
Pension  and  Retirement  Fund  Commission,"  to  make  a  survey  of  the  subject 
of  pensions  and  retirement  funds  for  the  employees  of  the  various  municipal, 
county  and  State  governments  and  the  school  teachers  and  school  employees  of 
the  State,  and  to  report  its  findings  to  the  present  or  a  future  session  of  the 
Legislature,  together  with  such  recommendations  as  it  may  deem  best  regarding 
pensions  and  retirement  funds. 

2.  Said  commission  shall  have  power  to  examine  witnesses,  to  call  for 
any  books,  records,  memoranda  or  other  material,  and  for  such  purposes  is 
hereby  given  authority  to  issue  subpoenas  for  the  presence  of  any  person  or 
persons  or  the  production  of  such  books,  records,  memoranda  or  other  material. 

3.  The  Commission  shall  sit  during  the  session  of  the  present  Legislature, 
and  after  adjournment  thereof  at  such  time  and  place  as  the  majority  may 
decide  and  shall  serve  without  pay,  but  shall  have  authority  to  engage  such 
assistants  as  may  be  deemed  wise  for  the  prosecution  of  their  investigation,  and 
to  defray  the  expenses  shall  use  such  moneys  or  any  portion  thereof  as  may  be 
appropriated  in  any  supplemental  or  annual  appropriation  bill. 

4.  This  joint  resolution  shall  take  effect  immediately. 


The  Commission 

Chairman 

Assemblyman  Arthur  N.  Pierson,  Union 

Senator  Wieeiam  E.  Florance,  Middlesex 
Assembeyman  Raeph  N.  Keelam,  Camden 
Senator  Wieeiam  B.  Mackay,  Bergen 

Secretary 

Assembeyman  Edward  P.  Stout,  Hudson 


"\. 


NEW<pEfcSEY 

State^S  hamber 

OF  G^M^MERCE 


BUREAU  OF  STATE  RESEARCH 


EXECUTIVE  OFFICE 

CLINTON  BUILDING.  NEWARK 

TEL.    MARKET   107 

November  1,  1918. 


To  the  Pension  and  Retirement  Fund  Commissioners 
of  the  State  of  New  Jersey. 

When  the  Pension  and  Retirement  Fund  Commission  was  created  by  the 
Legislature  of  1917  it  asked  the  Bureau  of  State  Research  to  assist  it  in  collecting 
data  and  performing  all  the  technical  part  of  the  investigation,  in  view  of  the 
fact  that  the  Bureau  of  State  Research  had  all  the  necessary  research  facilities 
and  a  staff  of  investigators  who  have  been  specially  trained  in  this  field  of  work 
through  their  previous  participation  in  a  similar  investigation  of  pension  funds. 

The  data  which  the  Bureau  of  State  Research  collected  and  submitted  to 
the  Commission  last  year  clearly  showed  that  all  the  existing  pension  funds  in 
New  Jersey  are  financially  unsound  and  that  the  chaotic  condition  of  pension 
systems  is  inimical  to  public  interest. 

Basing  its  report  on  the  information  collected  the  Commission  asked  the 
Legislature  to  authorize  a  further  detailed  investigation  with  a  view  to  reorganize 
the  existing  systems  on  a  sound  financial  and  administrative  basis. 

The  new  Commission  appointed  in  1918  directed  the  Bureau  of  State 
Research  to  continue  to  perform  the  technical  part  of  the  investigation.  In 
accordance  with  the  instructions  of  the  Commission,  the  Bureau  of  State 
Research  has  taken  a  census  of  all  the  teachers,  policemen  and  firemen  in  the 
state  and  has  prepared  estimates  of  cost  of  the  existing  systems  and  of  the  plan 
of  reorganization. 

The  Bureau  of  State  Research  has  endeavored  to  conduct  the  work  without 
bias  and  in  a  thoroughly  scientific  way  and  now  respectfully  submits  to  the 
Commission  all  the  data  which  it  has  collected  and  prepared. 

Respectfully, 


Secretary. 


Associate  Director. 


PENSION    AND    RETIREMENT    FUND    COMMISSION 

142D  SESSION  OF  THE  LEGISLATURE  OF  THE  STATE  OF  NEW  JERSEY 
J.  R.  3.  LAWS  OF  1918 


Chairman 

Assemblyman  ARTHUR  N.  PIERSON,  Union 

senator  WILLIAM  E.  FLORANCE.  Middlesex 
Assemblyman  RALPH  N.  KELLAM,  Camden 
Senator  WILLIAM  B.  MACKAY,  Bergen 

Secretary 

Assemblyman  EDWARD  P.  STOUT.  Hudson 


OFFICE   OF  THE   COMMISSION 
BUREAU   OF  STATE   RESEARCH 

OF   THE 

NEW   JERSEY   STATE   CHAMBER   OF  COMMERCE 

CLINTON   BUILDING.   NEWARK 


January  14,  1919. 


To  the  Senate  and  General  Assembly 
of  the  State  of  New  Jersey: 

The  Pension  and  Retirement  Fund  Commission  appointed  by  the  Legislature 
under  the  Joint  Resolution  No.  3,  Laws  of  1918,  "To  Investigate  the  Subject  of 
Municipal,  County  and  State  Pensions  and  the  Teachers'  Retirement  Fund  and 
the  Teachers'  35  Year  Half  Pay  Pension  Fund,"  submits  the  following  report 
on  its  investigation  of  the  Teachers'  Retirement  Fund  and  the  Teachers'  35  Year 
Half  Pay  Pension. 

Of  the  members  of  the  Commission,  the  Chairman  and  Senators  Mackay 
and  Florance  were  members  of  the  previous  Pension  and  Retiremeunt  Fund 
Commission  which  conducted  the  preliminary  investigation  during  1917.  Assem- 
blyman Stout  was  elected  to  act  as  Secretary  of  the  Commission.  On  the  death 
of  Assemblyman  Litchfield,  which  occurred  before  the  Commission  began  its 
work,  Assemblyman  Kellam  was  appointed  to  fill  the  vacancy. 

Considerable  data  regarding  the  teachers'  retirement  situation  in  this  state 
has  been  obtained  by  trained  investigators  and  by  means  of  public  hearings,  and 
with  this  data  in  hand  the  Commission  has  made  a  thorough  study  of  the  subject. 

The  critical  and  constructive  conclusions  reached  are  presented  in  the  first 
part  of  this  report.  The  analysis  of  the  bill  which  the  Commission  has  prepared 
providing  for  the  reorganization  of  the  existing  teachers'  pension  system  is  sub- 
mitted in  the  second  part.  The  actuarial  estimate  of  the  cost  of  the  existing 
systems  and  of  the  proposed  plan  is  given  in  part  three. 

The  Commission  has  been  greatly  assisted  by  the  Bureau  of  State  Research 
which  has  conducted  the  investigative  and  actuarial  work  under  the  direction  of 
Paul  Studensky,  Supervisor  of  the  Pension  Staff,  and  George  B.  Buck,  Actuary. 

Assemblyman  Arthur  N.  Pierson,  Chairman 
Senator  William  E.  Florance 
Assemblyman  Ralph  N.  Kellam 
Senator  William  B.  Mackay 
Assemblyman  Edward  P.  Stout,  Secretary 


'NEWJERSEY'  5 

PART  I 

Present  Systems  and  Their  Reorganization 

A  critical  and  constructive  study 

Two  years  of  investigation.  Existing  Styles  and  need  for  a  merger.  Condition  of  Retirement  Fund.  Con- 
dition of  State  Pension.  Cost  and  unsoundness  of  double  benefits.  Summary  of  present  situation.  New 
System.  Underlying  Principles.  Provisions.  Teachers'  contributions.  State's  contributions  compared  with 
teachers'.  Suggestions  from  teachers.  Summary,  Illustrative  cases.  Comparison  with  present  benefits. 
Amount  of  allowance  for  new  entrants  at  different  ages  of  retirement.  Amount  of  Allowance  to  teachers 
having  previous  service.  Amount  of  contributions  accumulated  at  4%  interest  after  certain  period  of  years. 
Reserves  for  certain  allowances  at  certain  ages.     Refunds.     Valuation  of  State's  liabilities. 


Two  years  of  investigation.  During  the  first  year  of 
its  investigation  the  Pension  and  Retirement  Fund 
Commission  made  only  a  very  general  survey  of  the 
two  retirement  systems  for  teachers — the  Retirement 
Fund  which  is  supported  by  membership  dues  and  pro- 
vides an  annuity  of  60%  of  salary  (minimum  $250, 
maximum  $650)  on  disability  after  20  or  more  years  of 
service,  and  the  35-year  Service  Pension  which  is  sup- 
ported entirely  by  the  State  and  provides  a  pension  of 
half-pay  after  35  or  more  years  of  service.  The  Com- 
mission postponed  making  any  definite  proposals  of 
legislative  changes  until  after  it  could  make  a  more 
thoroughgoing  investigation. 

Having  received  during  the  second  year  the  funds 
necessary  for  such  an  investigation,  the  Commission 
undertook  to  ascertain  as  carefully  as  possible  all  the 
facts  regarding  the  obligations  of  the  two  systems. 
With  that  purpose  in  view  it  took  a  census  of  all  the 
teachers  in  the  State  and  had  on  the  basis  of  that  cen- 
sus an  actuarial  valuation  of  the  liabilities  of  these 
systems  made. 

Existing  Systems  and  Need  For  a  Merger 

Condition  of  Retirement  Fund.  The  actuarial  report 
which  is  appended  hereto  shows  that  the  financial  con- 
dition of  the  Teachers'  Retirement  Fund  is  briefly  as 
follows : 

Obligations  towards  present  annuitants  and 

present  active  teachers $19,061,000 

Assets  which  the  Fund  will  realize  from 
present  capital  and  from  prospective  con- 
tributions of  present  active  teachers 4,239,000 


Deficit   $14,822,000 

The  deficiency  of  almost  $15,000,000  is  the  result  of 
the  inadequacy  of  the  rates  of  contributions  charged 
by  the  Fund,  especially  in  the  case  of  the  older  teach- 
ers, who  joined  it  during  the  first  ten  years  of  its  op- 
eration, to  pay  the  benefits  promised.  The  total 
assets  now  on  hand  cover  only  18%  of  the  liabilities 
on  account  of  present  annuitants  (capital  of  $485,000 
as  against  liabilities  of  $2,631,000).  The  total  assets 
receivable  in  the  future  from  present  active  members 
cover  only  23%  of  the  liabilities  on  account  of  their 
future  annuities  (prospective  assets  of  $3,754,000  as 
against  liabilities  of  $16,400,000).  This  means,  on  the 
present  basis,  that  if  the  present  annuitants  shall  re- 


ceive more  than  18%  of  their  present  benefits,  the 
future  annuitants  among  the  present  active  members 
shall  receive  less  than  23%  of  the  promised  rate  of 
benefits. 

To  maintain  the  present  rate  of  benefits,  cover  the 
immense  deficiency  and  put  the  Fund  on  a  solvent  basis 
so  far  as  its  future  operation  is  concerned,  it  would  be 
necessary  to  increase  the  contributions  of  the  members 
to  approximately  9%  of  salary  if  the  deficiency  is  to  be 
liquidated  in  25  to  30  years  or  8%  or  7%  if  it  should 
be  spread  over  a  longer  period,  as  may  be  seen  from 
the  following  table: 

Normal  contributions  for  future  ser- 
vices of  present  members  graduated 
for  either  sex  according  to  age,  and 
averaging    4%  of  salaries 

Deficiency  contribution  on  account  of 
prior  service  of  present  active  mem- 
bers to  be  paid  approximately  for  25 
to  30  years 3%  of  salaries 

Deficiency  contribution  on  account  of 

present  annuitants 2%  of  salaries 

Total 9%  of  salary 

decreasing  in  the  course  of  25  to  30  years  to  7%,  after 
which  it  would  drop  to  approximately  4%. 

It  appeared  to  the  Commission  that  an  assessment  of 
7,  8  or  9  per  cent,  on  the  salaries  of  all  the  members 
of  the  Fund  would  be  far  greater  than  the  members 
could  bear  and,  furthermore,  that  it  could  hardly  be 
equitable  as  between  younger  and  older  teachers  if 
compared  with  the  benefits  they  would  receive.  Where- 
as many  of  the  older  teachers  who  joined  the  Fund 
between  1896  and  1907  would  receive  as  much  as  forty 
times  the  amount  they  have  contributed,  the  younger 
members  who  would  contribute  the  higher  rates  for 
20,  30  or  40  years  would  eventually  receive  much  less 
than  the  amount  they  have  contributed  could  purchase. 
Still  others  who  would  withdraw  from  the  service 
through  resignation  or  dismissal  and  the  dependents  of 
those  who  would  die  before  retirement  would  receive 
for  all  their  rather  considerable  payments  no  benefits 
whatever.  The  Fund  could  not  insure  the  fulfillment  of 
all  its  promises  by  increasing  the  contributions  to  a  rate 
which  would  be  equitable  and  not  too  burdensome  to 
its  members. 


'NEW 


JERSEY 


Condition  of  State  Pension.  The  Commission  had 
two  actuarial  valuations  made  of  the  35-year  Service 
Half  Pay  Pension  System :  one  based  upon  an  assumed 
age  distribution  and  taken  as  of  June  30,  1917,  and  the 
other  based  upon  the  actual  age  distribution  obtained 
by  the  census  which  the  Commission  has  taken,  and 
brought  to  June  30,  1918.  The  results  of  the  two  val- 
uations differ  only  slightly.  The  obligations  of  the 
System  with  respect  to  both  present  pensioners  and 
prospective  beneficiaries  among  the  present  force 
amount  to  $23,129,000.  These  obligations  would  on  the 
present  basis  be  met  by  annual  appropriations  which 
would  increase  from  year  to  year  at  a  more  rapid  rate 
than  the  payroll.  They  would  eventually  amount  to 
more  than  10%  of  the  payroll  and  become  exceedingly 
burdensome.  To  place  the  system  on  a  reserve  basis 
and  thus  distribute  the  burdens  more  evenly  as  be- 
tween the  present  and  the  future,  it  would  be  necessary 
for  the  State  to  contribute  annually  from  now  on  an 
amount  equal  to  about  8%  of  the  total  payroll,  as 
shown  below : 

Normal  contribution,  for  future  ser- 
vices of  present  active  members. .    Sy2%  of  salaries 

Deficiency  contributions  for  prior 
services  of  present  active  mem- 
bers, to  be  paid  for  approximately 
25  years   3%  of  salaries 

Deficiency  contribution  on  account 
of  present  pensions 1^2%  of  salaries 

Total 8%  of  salary 

As  the  State  now  appropriates  on  account  of  present 
pension  roll  only  approximately  1>2%  of  the  payroll 
(about  $230,000)  it  would  have  to  increase  the  appro- 
priation to  about  five  times  that  rate,  i.  e.,  to  over  a 
million  dollars.  That  this  would  impose  a  consider- 
able burden  upon  the  State  is  evident.  It  would  seem 
hardly  fair  that  the  State  should  bear  it,  especially  con- 
sidering that  only  a  portion  of  the  teachers  would  enjoy 
its  benefit  and  that  according  to  all  sound  standards 
the  beneficiaries  should  participate  in  the  cost  of  their 
pension. 

Cost  and  unsoundness  of  double  benefits.  It  has  been 
shown  that  the  majority  of  the  teachers  now  retiring 
receive  double  benefits  ranging  between  70%  and 
110%  and  even  more  of  their  salaries  and  averaging 
103 %.1  The  maintenance  of  the  present  double  sys- 
tem and  double  benefits  for  present  teachers  would 
cost  more  than  $42,000,000  ($23,129,000  for  the  35- 
year  Half  Pay  Pension,  and  $19,961,000  for  the  Re- 
tirement Fund  Annuity),  towards  which  the  teachers 
would    contribute    at    the    present    rate    only    about 

'The  analysis  of  the  retired  teachers'  roll  shows  that  363 

retired  teachers  receive  double  benefits,  225  receive  the  annuity 

only  and  54  receive  the  pension  only.    The  facts  about  those 

receiving  double  benefits  are  as  follows  : 

189  teachers  are  enjoying  benefits  of  110%  of  salary  and  more. 

86  teachers  are  enjoying  benefits  of  100%  to  110%  of  salary. 

78  teachers  are  enjoying  benefits  of    75%  to  100%  of  salary. 

10  teachers  are  enjoying  benefits  of    70%  to    75%  of  salary. 

363  teachers  are  enjoying  benefits  averaging    103%    of    salary 
($1,083  as  against  average  salaries  of  $1,054). 


$4,500,000  (including  the  present  capital  of  the  Fund 
of  $500,000).  The  annual  cost  would  approximately 
equal  16%  of  the  payroll,  of  which  the  teachers  would 
contribute  on  the  present  basis  only  about  2%.  For 
the  present  it  would  amount  to  more  than  $2,000,000 
annually,  of  which  the  teachers  would  now  contribute 
only  about  $260,000. 

It  is  evident  that  the  State  could  not  supply  the 
tremendous  difference  between  the  contributions  of  the 
teachers  and  the  cost  of  the  double  benefits.  Further- 
more, it  would  be  against  the  economic  interests  of 
the  majority  of  the  teachers  if  it  should,  because  the 
$42,000,000  would  supply  only  two  kinds  of  benefits — 
the  double  superannuation  benefit  (pension  and  an- 
nuity) after  35  years  of  service,  and  the  strictly  dis- 
ability benefit  (the  annuity)  between  20  and  35  years. 
Nothing  will  go  to  the  dependents  of  the  teachers  who 
die.  Nothing  to  those  who  resign  or  are  dismissed  be- 
fore retirement  and  who  have  contributed  for  a  num- 
ber of  years.  Nothing  to  those  who  become  disabled 
before  20  years  of  service:  approximately  one-fourth 
of  the  present  teachers  will  receive  double  benefits,  one- 
eighth  will  retire  on  one  or  the  other  benefit  only,  and 
two-thirds  will  receive  no  benefit  whatsoever — most  of 
them  not  even  protection  for  disability  as  they  would 
withdraw  from  the  service  before  the  time  when  under 
the  present  system  disability  protection  begins.2 

The  double  benefits  amounting  to  full  salary  or  more 
and  the  inequitableness  of  the  system  would  unfavor- 
ably affect  the  school  system.  Teachers  who  can  by  re- 
tiring receive  the  same  or  even  greater  allowance  than 
the  salary  they  are  receiving  would  have  no  incentive  to 
continue  teaching.  Efficient  teachers  would  seek  to 
retire  before  they  become  superannuated.  Incapacitated 
teachers  would  postpone  retirement  until  they  could 
qualify  for  both  benefits.  Inefficient  and  not  incapaci- 
tated teachers  who  have  completed  20,  25  or  30  years 
of  service  would  neither  resign  nor  be  dismissed  be- 
cause this  would  entail  for  them  a  forfeiture  of  all 
their  contributions.  These  tendencies  are  already 
apparent.  Both  for  the  teachers  and  for  the  State  the 
situation  would  become  unbearable. 

'Summary  of  present  situation.  To  summarize  the 
present  situation : 

1.  The  Retirement  Fund  will  be  unable  to  fulfill  its 
present  promises  and  cannot  be  supported  on  a 
solvent  basis  by  the  contributions  of  its  members. 

2.  The  35  years  Service  Pension  is  too  burdensome 
for  the  State  to  maintain  without  contributions 
from  teachers. 

3.  There  is  no  principle  justifying  the  double  bene- 
fits amounting  to  full  salary  or  more ;  they  are  in- 
equitable and  economically  and  administratively 
unsound. 

All  these  considerations  have  convinced  the  Commis- 
sion that  the  present  two  systems  should  no  longer  con- 
tinue to  operate  separately;  that  there  is  no  justifica- 
tion for  maintaining  the  double  benefits ;  and  that  some 
plan  for  the  merger  of  the  two  systems  and  for  a  more 
equitable  distribution  of  benefits  must  be  devised. 

*  Disability  benefits  under  the  Retirement  Fund  are  paid  only 
after  20  years  of  service. 


'NEW 


JERSEY' 


New  System 
Principles  underlying  new  system.  In  framing  the 
provisions  of  a  new  retirement  system  into  which  the 
two  existing  systems  should  merge  the  Commission  was 
guided  by  the  following  three  principles,  upon  which 
all  sound  retirement  systems  are  founded : 

1.  The  system  should  be  established  on  a  reserve 
basis,  i.  e.,  each  year  throughout  the  service  of 
each  member  a  contribution  should  be  set  aside 
which  shall  accumulate  together  with  interest  a 
reserve  which  shall  be  sufficient  on  an  average  to 
pay  the  retiring  member  the  benefit  promised  to 
the  end  of  his  or  her  life. 

2.  The  system  should  be  supported  by  joint  contribu- 
tions of  the  members  and  of  the  employer  (in  this 
case,  the  State)  and  jointly  administered  by  them 
because  there  is  a  mutual  interest  between  the 
employees  and  the  employer  in  retirement  provi- 
sions, the  former  seeking  protection  for  them- 
selves and  for  their  dependents  against  want  in 
their  old  age,  in  case  of  disability  or  death  and 
to  some  extent  in  case  of  resignation  or  dismissal, 
and  the  latter  endeavoring  to  secure  a  higher  ef- 
ficiency of  service  by  eliminating  deadwood  from 
the  service,  and  replacing  them  by  younger  and 
more  efficient  forces  and  attracting  to  the  service 
a  better  type  of  employee  and  promoting  the 
esprit  de  corps  of  the  personnel ;  and 

3.  Any  member  who  withdraws  from  the  service 
through  resignation  or  dismissal  before  retire- 
ment and  the  estate  of  any  member  who  dies  be- 
fore retirement  should  receive  all  the  contribu- 
tions he  or  she  had  paid,  together  with  interest; 
each  member's  contributions  should  be  credited  to 
his  or  her  account  and  should  be  carried  until 
retirement  in  a  similar  way  as  deposits  in  a  sav- 
ings bank. 

The  Commission  endeavored  to  make  the  provisions 
of  the  proposed  system  as  liberal  as  possible  within 
certain  limitations  of  cost,  and  the  system  as  equitable 
and  elastic  as  a  sound  retirement  system  can  be. 

The  Commission  also  endeavored  to  make  the  tran- 
sition from  the  old  system  to  the  new  system  as  gradual 
as  conditions  would  permit  and  reduce  as  far  as  possi- 
ble the  hardships  which  in  anj  process  of  transition 
might  occur  in  individual  cases. 

Prozisions  of  new  system.  The  provisions  of  the 
proposed  system  are  outlined  in  detail  in  the  statement 
on  pages  13  to  17.  They  may  be  briefly  summarized 
as  follows : 

A  new  fund  called  the  New  Jersey  Teachers'  Pension 
and  Retirement  Fund  is  to  be  created.  The  feature  of 
the  Teachers'  Retirement  Fund  compelling  all  new  ap- 
pointees to  be  members  of  that  fund  is  to  be  repealed. 
Hereafter  all  new  appointees  shall  be  compelled  to  be- 
come members  of  the  new  fund.  For  present  teachers 
membership  in  the  new  fund  shall  be  optional.  Those 
who  are  members  of  the  Retirement  Fund  may  if  they 
wish  transfer  to  the  new  rund. 

The  new  fund  is  to  be  administered  by  a  board  in 
which  the  teachers  and  the  State  shall  be  equally  rep- 
resented. Retirement  shall  be  optional  at  the  age  of  62 
and  compulsory  at  70.     The  amount  of  allowance  is 


approximately  equal  to  l/70th  of  the  average  salary  of 
the  5  years  preceding  retirement,  for  each  year  of  ser- 
vice.1 There  is  no  maximum  limit  on  the  amount  of  the 
allowance.  The  latter  may  exceed  half  pay  in  case  of 
service  above  35  years.  In  no  case  shall  the  super- 
annuation allowance  be  less  than  $400.  Credit  is  al- 
lowed for  service  rendered  in  the  public  schools  in 
other  States  up  to  a  maximum  of  10  years. 

A  disability  allowance  is  provided  after  10  or  more 
years  of  service  and  is  fixed  at  the  same  l/70th  rate 
as  the  superannuation  allowance,  except  that  it  cannot 
be  less  than  30%  of  salary  or  $300,  whichever  shall  be 
larger,  and  on  the  other  hand  cannot  exceed  9/10  of 
the  amount  of  allowance  to  which  the  teacher  would 
have  been  entitled  had  he  stayed  in  the  service  until  62. 

In  case  of  resignation  or  dismissal  from  the  service 
before  retirement  the  member  shall  receive  all  his  con- 
tributions together  with  interest  at  3%.  In  case  of 
death  before  retirement,  the  estate  of  the  member  shall 
receive  the  contributions  of  the  member  together  with 
interest  at  3%. 

At  the  time  of  retirement  any  teacher  may  exercise 
his  option  as  to  the  form  in  which  he  would  like  to 
take  his  benefits.  He  may  convert  the  reserve  into  a 
smaller  annual  payment  with  the  proviso  that  after  his 
death  the  balance  shall  be  paid  in  a  lump  sum  or  in  the 
form  of  an  annuity  to  any  person  which  he  may  desig- 
nate. 

Any  teacher  who  transfers  from  the  Teachers'  Re- 
tirement Fund  to  the  new  fund  shall  be  credited  in  the 
latter  with  the  amount  which  he  contributed  to  the 
former  fund  and  shall  receive  at  retirement  such  an 
annuity  as  this  amount  will  purchase.  This  annuity  is 
additional  to  any  other  benefit  received  under  the  new 
act. 

The  payment  of  the  existing  pensions  granted  under 
the  35-year  Service  Act  shall  be  continued  as  hereto- 
fore. In  case  the  annuities  received  from  the  Retire- 
ment Fund  by  any  teacher  now  on  the  retired  list  who 
does  not  receive  the  pension,  shall  be  reduced  because 
of  the  inability  of  the  Fund  to  pay  full  annuities,  the 
State  will  supply  the  difference  between  the  reduced 
annuity  and  the  one  which  the  teacher  received  here- 
tofore. 

Teachers'  Contributions.  The  teachers  will  contrib- 
ute half  of  the  cost  of  the  benefits  for  all  services 
rendered  after  the  establishment  of  the  new  system. 

1  The  retirement  allowance  for  future  service  consists  of 
two  elements :  a  "pension"  provided  by  the  state  amounting  to 
l/140th  of  the  salary  for  each  year  of  service,  and  an  "an- 
nuity" provided  by  the  teacher's  own  contributions  which  in 
the  case  of  average  advancement  of  salary  will  be  equal  to 
the  "pension."  Together  the  two  benefits  will  make  up  the 
l/70th  fraction  of  salary  for  each  year  of  service.  However, 
in  case  the  teacher  advanced  during  the  later  period  of  his 
career,  at  a  more  rapid  rate  than  the  average,  his  contributions 
made  at  the  average  rate  of  salary  will  not  be  sufficient  to 
provide  an  annuity  bearing  the  l/140th  per  year  of  service 
ratio  to  his  larger  salary.  The  total  allowance  will,  therefore, 
be  somewhat  less  than  l/70th  of  salary  multiplied  by  years 
of  service.  On  the  other  hand,  if  the  teacher  advanced  at  a 
slower  rate  than  the  average  his  contributions  will  provide  an 
annuity  bearing  a  larger  ratio  to  his  salary.  In  this  way  the 
teachers  who  advance  at  a  slower  rate  than  the  average  will 
not  be  taxed  to  pay  the  annuities  of  the  teachers  who  advance 
at  a  more  rapid  rate  than  the  average. 


8 


'NEW 


JERSEY' 


The  other  half  will  be  supplied  by  the  State.  They 
need  not  contribute  on  account  of  benefits  for  prior 
service.  The  State  will  contribute  its  own  as  well  as 
the  teachers'  part  for  all  the  prior  years.  It  will  thus 
place  the  teacher  in  the  same  position  as  if  the  State 
and  the  teacher  contributed  on  his  or  her  account  at  a 
proper  rate  from  the  time  the  teacher  entered  the  ser- 
vice and  up  to  the  present  date.  Contributions  of  the 
teachers  are  fixed  according  to  age  at  the  time  they  en- 
ter the  new  fund  and  vary  for  men  between  3^2% 
and  6%  of  salary,  and  for  women  between  3^%  and 
7%  of  salary. 

A  teacher  who  enters  the  system  at  an  earlier  age 
has  a  longer  period  within  which  to  contribute  his 
share  of  the  cost  of  his  prospective  benefit  than  a 
teacher  who  enters  the  service  at  a  later  age.  The 
latter  must  therefore  pay  a  higher  rate  of  contribution 
towards  the  same  benefit  than  the  former. 

Rates  of  Contribution  Required  of  Teachers  Under  Pro- 
posed Plan.     Retirement  Age  62. 

Allowance  1/70  of  the  average  salary  of  the  five  years 
immediately  preceding  retirement,  multiplied  by  the 
number  of  years  of  service. 


AGE 

MEN 

WOMEN 

At  Entrance  Into 

(Percentage 

(Percentage 

the  New  Fund 

of  Salary) 

of  Salary) 

20 

3.60 

3.91 

21 

3.60 

3.93 

22 

3.60 

3.95 

23 

3.61 

3.98 

24 

3.62 

4.01 

25 

3.62 

4.05 

26 

3.64 

4.09 

27 

3.66 

4.13 

28 

3.69 

4.18 

29 

3.72 

4.25 

30 

3.76 

4.32 

31 

3.78 

4.39 

32 

3.84 

4.46 

33 

3.89 

4.53 

34 

3.93 

4.60 

35 

3.97 

4.68 

36 

4.01 

4.75 

37 

4.07 

4.84 

38 

4.13 

4.94 

39 

4.19 

5.04 

40 

4.26 

5.13 

41 

4.33 

5.22 

42 

4.40 

5.32 

43 

4.47 

5.42 

44 

4.54 

5.53 

45 

4.61 

5.63 

46 

4.68 

5.73 

47 

4.76 

5.83 

48 

4.84 

5.93 

49 

4.92 

6.04 

50 

5.01 

6.16 

51 

5.10 

6.27 

52 

5.19 

6.38 

53 

5.28 

6.49 

54 

5.37 

6.60 

55 

5.46 

6.71 

56 

5.56 

6.83 

57 

5.67 

6.94 

58 

5.78 

7.05 

59 

5.89 

7.17 

60 

6.00 

7.29 

retiring  at  the  same  age  is  only  11.84  years.  It  costs 
$10,760  to  provide  a  retirement  allowance  of  $1,000  to 
a  woman  teacher  retiring  at  that  age,  and  only  $8,770, 
or  about  $2,000  less,  to  provide  the  same  allowance  to 
men  teachers  retiring  at  the  same  age.  To  meet  its 
share  of  the  higher  cost  of  benefits  of  the  women  teach- 
ers, the  State  must  contribute  in  their  case  at  a  higher 
rate  than  in  case  of  the  men. 

While  the  contributions  required  in  case  of  entrants 
at  higher  ages  may  seem  high  (6%  and  7%),  it  must 
be  noted  that  they  will  be  paid  only  for  a  few  years,  as 
all  contributions  cease  at  62  years  of  age.  Once  the 
rate  of  contribution  of  a  teacher  has  been  fixed  it  re- 
mains at  that  rate  throughout  the  entire  period  of  his 
service,  except  that  it  may  be  slightly  increased  or 
reduced  if  at  any  subsequent  actuarial  valuation  a 
higher  or  lower  rate  of  mortality  is  obtained  than  the 
one  originally  adopted. 

Contributions  of  State  as  compared  with  those  of 
teachers.  In  case  of  new  entrants,  i.  e.,  teachers  ap- 
pointed after  the  establishment  of  the  new  system,  the 
State  will  contribute  at  such  a  rate  as  to  match  the 
benefit  which  the  teachers'  own  contributions  will 
provide. 

Rates  of  Contributions  to  Be  Paid  by  the  State  Under  the 
Proposed  Plan  of  Reorganization,  to  Meet  Half  of  the 
Cost  of  the  Retirement  Allowances  to  New  Entrants 
and  For  Future  Services  of  Present  Teachers. 

NOTE:  The  rate  is  lower  than  that  required  of  the 
teachers.  This  is  due  to  the  fact  that  the  number  of 
teachers  who  would  leave  the  service  before  retirement, 
is  discounted  in  the  case  of  the  State's  contribution  (i.  e., 
the  State  does  not  contribute  on  their  account). 

In  addition  to  these  contributions  the  State  must  con- 
'  tribute  on  account  of  the  total  cost  of  allowances  for  past 
services  and  all  outstanding  pensions  as  shown  on  page 
9  of  this  report. 


AGE 

MEN 

WOMEN 

At  Entrance  Into 

(Percentage 

(Percentage 

the  New  Fund 

of  Salary) 

of  Salary) 

20 

1.97 

2.15 

21 

1.99 

2.23 

22 

2.01 

2.32 

23 

2.03 

2.41 

24 

2.05 

2.51 

25 

2.08 

2.62 

26 

2.11 

2.75 

27 

2.14 

2.88 

28 

2.18 

3.02 

29 

2.22 

3.15 

30 

2.26 

3.27 

31 

2.30 

3.36 

32 

2.34 

3.44 

33 

2.39 

3.52 

34 

2.44 

3.60 

35 

2.49 

3.67 

36 

2.52 

3.71 

37 

2.54 

3.73 

38 

2.56 

3.75 

39 

2.58 

3.76 

40 

2.63 

3.77 

41 

2.70 

3.78 

42 

2.79 

3.79 

43 

2.88 

3.81 

44 

2.98 

3.83 

45 

3.08 

3.85 

Experience  shows  that  women  teachers  must  con- 
tribute at  a  higher  rate  than  men,  because  they  live 
longer  after  retirement  than  the  latter.  The  average 
life  time  of  women  teachers  retiring  at  age  62  is  15.27 
years,  whereas  the  average  life  time  of  men  teachers 


In  case  of  present  teachers  the  State  will  contribute 
much  more  than  the  teachers.  Whereas  the  greater 
part  of  the  teachers'  contributions  averaging  about 
4T/2%  will  eventually  revert  to  them  together  with 
interest,  as  the  majority  will  leave  the  service  before 


'NEW 


JERSEY' 


retirement,    no    part    of    the    State's    contributions, 
amounting  to  about  7%  of  salaries,  will  revert  to  it : 
Normal  contribution  on  account  of 

benefits    for    future    services    of 

present  teachers,  averaging 2^2%  of  salaries 

Deficiency  contributions  on  account 

of  benefits  for  prior  services  of 

present  teachers,  approximately.     3%  of  salaries 
Contributions  on  account  of  present 

pension  roll  V/2%  oi  salaries 

Total 7%  of  salary 

besides  cost  of  administration,  additional  benefits,  cost 
of  minimum  benefit  provision,  and  guarantee  in  case 
of  a  deficiency. 

The  difference  in  the  proportion  of  cost  borne  by 
present  teachers  and  by  the  State  on  their  account  may 
well  be  shown  by  the  fact  that  whereas  the  present 
teachers  will  contribute  on  account  of  their  superan- 
nuation and  disability  benefits  approximately  $6,300,- 
000,  the  State  will  contribute  on  that  account  approxi- 
mately $21,600,000,  i.  e.,  more  than  75%  of  the  cost. 
All  teachers'  contributions  above  $6,300,000  will  be 
merely  savings  accounts.  They  will  be  contributed 
and  drawn  out  with  interest  by  those  teachers  or  by 
their  dependents,  who  eventually  resign,  are  dismissed 
or  die  before  retirement.  Thus  every  member  of  the 
force  will  to  a  greater  or  lesser  extent  become  a  bene- 
ficiary of  the  system.  This  feature  vitally  differs  from 
the  present  tontine  arrangement  which  has  been  dis- 
cussed on  page  8. 

The  contributions  as  between  different  benefits  pro- 
vided are  distributed  as  follows : 

Teachers'  Contributions 

Superannuation  Allowances  $  5,257,261 

Disability  Allowances   1,039,692 

Total  Teachers'  Contributions $  6,296,953 

State's  Contributions 
Superannuation  Allowances : 

Now  Outstanding $  2,140,849 

For  Prior  Service 8,167,627 

For   Future   Service 5,257,261 

Total  for  Superannuation $15,565,735 

Disability  Allowances  5,016,093 

Disability  Pension  to  guarantee  present 
annuities  of  those  who  receive  the  an- 
nuity only  689,508 

Additional  Annuities  in  compensation  of 
contribution  to  Retirement  Fund 314,649 

Total   State's   Contributions $21,585,987 

The  foregoing  figures,  including  rates  of  state's 
contributions  on  page  8,  have  been  computed  on  the 
basis  of  the  original  plan  of  the  Commission.  Since 
then  many  new  features  were  incorporated  in  the 
bill  (such  as  the  computation  of  allowances  on  the 
basis  of  last  5  instead  of  10  years,  the  increase  of  dis- 
ability allowances  to  the  l/70th  rate  and  the  minimum 
benefit  provisions)  which  will  still  further  increase 
the  difference  between  the  cost  to  the  state  and  the 
cost  to  the  present  teachers. 

The  transition  from  an  almost  gratuitous  to  a  con- 
tributory pension  under  the  proposed  system  is  a  grad- 
ual one.  Whereas  a  teacher  who  is  now  62  years  of 
age  and  had  35  or  40  years  of  service  to  his  credit  will 
receive  his  allowance  of  35/70ths  or  4O/70ths  of  salary 


entirely  at  the  expense  of  the  State,  and  only  a  small 
additional  annuity  at  his  own  expense  (i.  e.,  for  the  few 
hundred  dollais  he  has  contributed  to  the  old  fund), 
the  teachers  retiring  5,  10  or  20  years  hence  will  have 
contributed  a  noticeable  share  of  the  cost  of  their  bene- 
fits. Finally  those  retiring  30,  40  or  50  years  from 
now  will  have  contributed  one-half  of  the  cost  of  their 
superannuation  or  disability  benefits.  Thus  in  the 
course  of  about  fifty  years  the  system  will  reach  the 
truly  "fifty-fifty"  basis. 

Suggestions  From  Teachers 

Taking  the  view  that  the  teachers'  retirement  ques- 
tion vitally  affects  the  teachers  as  well  as  the  schools 
and  the  public  at"  large,  the  Commission  endeavored 
to  give  a  wide  publicity  to  its  findings  and  proposals,  t© 
carefully  examine  all  criticisms  which  the  latter  might 
evoke  and  to  incorporate  in  its  proposals  any  sound 
suggestions  that  might  have  been  advanced. 

Many  teachers  have  urged  that  retirement  on  half 
pay  should  be  allowed  before  62  years  of  age.  The 
Commission  has,  therefore,  increased  the  disability 
benefit  from  l/75th  of  salary  per  each  year  of  service 
to  l/70th  (although  this  feature  is  open  to  abuse). 
Thus  a  teacher  who  entered  the  service  at  22  or  23 
and  has  completed  35  years  of  service  at  57  or  58  years 
of  age  and  who  is  no  longer  capable  to  teach  efficiently, 
can  upon  proper  proof  of  such  incapacity  retire  on 
35/70ths  of  her  salary,  i.  e.,  on  half  pay.  It  would  be 
possible  also  to  reduce  the  age  for  optional  retirement 
to  60,  but  this  would  naturally  increase  both  the  teach- 
er's and  the  State's  rates  of  contributions  as  compared 
with  the  rates  required  for  retirement  at  62.  The  rates 
for  the  lower  age  are  now  being  calculated  by  the  ac- 
tuary of  the  Commission  and  will  be  published  in  a 
special  pamphlet,  as  soon  as  the  calculations  are  com- 
pleted. The  teachers  and  the  State  will  then  be  in  a 
better  position  to  discuss  this  question. 

Another  demand  advanced  by  some  teachers  was  that 
the  retirement  allowance  should  be  computed  on  the 
average  salary  of  last  5  years  rather  than  on  the  aver- 
age of  last  10  years,  as  originally  intended  by  the  Com- 
mission. Although  the  latter  affords  a  more  stable 
basis  for  the  financing  of  the  system,  and  is  more  equit- 
able than  the  5  year  basis,  the  Commission  decided  to 
change  to  the  latter  basis  in  order  that  the  pension  of 
some  of  the  teachers  about  to  retire  should  not  be 
smaller  than  the  one  provided  on  that  basis  under  the 
35-year  Half-pay  Pension  Law. 

The  third  important  feature  urged  by  some  teach- 
ers and  thereupon  adopted  by  the  Commission  was  that 
outside  experience  should  be  credited  up  to  a  maximum 
of  10  years.  The  cost  of  the  additional  benefit  for  that 
experience  would  be  supplied  entirely  by  the  State,  so 
far  as  present  teachers  are  concerned. 

The  new  entrants  desiring  credit  for  their  outside  ex- 
perience not  exceeding  10  years  must  cover  half  of  the 
cost  of  the  benefit  on  that  account,  the  State  supplying 
the  other  half.  A  teacher  coming  from  Massachusetts, 
Connecticut,  Pennsylvania  or  New  York  City  will 
bring  with  him  to  the  New  Jersey  fund  the  contribu- 
tions which  the  systems  of  the  latter  States  or  cities 
refunded  to  him  when  he  withdrew  from  the  service. 
Little  or  nothing  would  have  to  be  contributed  in  addi- 


10 


'NEW 


JERSEY' 


tion.  On  the  other  hand  a  teacher  coming  from  a  State 
which  has  no  retirement  system  or  does  not  allow  re- 
funds on  withdrawal,  or  a  teacher  who  did  not  become 
a  member  of  the  retirement  system  in  the  other  State, 
will  be  charged  a  somewhat  higher  rate  of  contribution 
for  outside  experience  if  he  wishes  to  get  credit  for  it. 
Finally  the  fourth  point  brought  to  the  attention  of 
the  Commission  and  favorably  acted  upon  was  that  a 
minimum  amount  of  allowance  be  established.  The 
$400  minimum  adopted  for  superannuation  will  assure 
all  low-salaried  teachers  (those  receiving  less  than  $800 
per  year)  an  allowance  of  more  than  half  pay.  The 
disability  minimum  of  $300  is  $50  larger  than  the  one 
now  provided  by  the  Retirement  Fund. 

Summary 

The  proposed  plan  is  more  liberal  than  the  systems 
of  Massachusetts  and  Connecticut,  for  it  gives  higher 
superannuation  and  disability  benefits,  gives  credit  for 
outside  experience  and  imposes  no  maximum  limit  on 
the  amount  of  the  retirement  allowance.  It  is  more  lib- 
eral than  the  system  of  New  York  City,  for  it  computes 
the  allowance  on  the  average  salary  of  last  5  instead  of 
10  years,  proportionately  increases  the  allowance  be- 
yond half  pay  in  case  of  service  above  35  years,  and 
gives  a  higher  disability  benefit.  It  is  more  liberal  than 
the  system  of  Pennsylvania,  for  it  calculates  the  super- 
annuation allowance  on  the  l/70th  instead  of  the 
l/80th  rate,  gives  credit  for  outside  experience  and 
greater  disability  benefits,  and  establishes  a  minimum 
amount  of  allowance. 

Compared  with  the  present  system  of  New  Jersey  it 
offers  the  following  advantages : 

1.  Greater  assurance  that  all  the  benefits  promised  shall  be 
paid. 

2.  Return  of  contributions  with  interest  at  3%  in  case  of 
resignation  or  dismissal. 

3.  Death  benefits  before  retirement  in  the  form  of  refunds 
with  3%  interest. 

4.  Disability  protection  after  10  years  instead  of  20. 

5.  Equitable  increase  of  retirement  allowance  with  longer 
service. 

6.  Convertibility  of  the  individual  reserves  into  such  life  or 
death  benefits  as  the  member  may  at  the  time  of  his  re- 
tirement select. 

7.  Greater  equitableness  and  elasticity  of  benefits. 

Table  1 — Amounts  Which  an  Annual  Contribution  of  $25, 
$35,  $50,  $75  or  $100  Deposited  at  4%  Interest  Will 
Produce  at  the  End  of  a  Certain  Period  of  Years. 
No.  of 

$50 
8  281.65 
624.30 
1,041.25 
1,548.45 
2,165.60 
2,916.40 
3,829.90 
4,941. 85 

Table  a— What  an  Annual  Contribution  of  $25,  $35,  $50, 
$75  or  $100  Compounded  Annually  at  3%  Interest 
Will  Amount  to  After  a  Certain  Period  of  Years. 
No.  of 

S50 

8   273.40 

590.40 

957.85 
1,383.80 
1,877.65 
2,450.15 
3,113.89 
3,883.16 


Years 

5 
10 
15 
20 
26 
39 
35 
40 


925 

$    140.82 

312.15 

520.62 

774.22 

1,082.80 

1,458.20 

1,914.95 

2,470.67 


$35 

$    197.17 

437.01 

728.87 

1,083.91 

1,515.92 

2,041.48 

2,680.93 

3,458.94 


$76 
8  422.47 
936.45 
1,561.87 
2,322.67 
3,248.40 
4,374.60 
5,744.85 
7,412.02 


$100 
9  563.30 
1,248.60 
2,082.50 
3,096.90 
4,331.20 
6,832.80 
7,659.80 
9,882.70 


Years 

5 
10 
15 
20 
25 
30 
35 
40 


$25 

|    136.70 

295.20 

478.92 

691.90 

938.82 

1,225.07 

1,556.90 

1,941.57 


$35 

I   191.38 

413.28 

670.49 

968.66 

1,314.35 

1,715.10 

2,179.66 

2,718.20 


$75 
9  410.10 
885.60 
1,436.77 
2,076.70 
2,816.47 
3,675.22 
4,670.70 
6,824.72 


$100 
8  546.80 
1,180.80 
1,915.70 
2,767.60 
3,765.30 
4,900.30 
6,227.60 
7,766.39 


Table  3 — Comparison  of  the  Superannuation  and  Disabil- 
ity Benefits  of  the  Existing  Systems  and  the  Proposed 
Plan  in  Case  of  a  Teacher  Entering  Service  at  22  and 
Drawing  an  Average  Salary  of  $1,050  for  the  5  Years 
Preceding  Retirement. 


Proposed  Retire- 

ment Plan  (l/70th 

Teach« 

JS-Year 

Age  at  which 

of  salary  for  each 
year  01  service) 

i 

neat  Fund 

Service  Pea* 

Benefit  is  paid 

(60%  of  salary) 

(S0%  ©faaku 

22 

A    9 

2   G 

23 

V.    -M        . 

24 

+•>     ft     V) 

C    V  +2 

25 

o  Cya 

0  v  v 

26 

27 
28 

und   of 
3  with  in 
bility  bei 

1* 

29 
30 

Ref 
tion 
disa 

> 

■*-> 
M 

31 

% 

■4-> 

32 

'$315 

33 
34 

315 
315 

IB 

6 

c 

35 

315 

o 

36 

315 

£ 

37 

315 

1 

38 

315 

1 

39 

315 

£ 

40   . 

315 

+■» 

41 

315 

g 

42 

315 

$630 

O 

43 

315 

'  630 

fc 

44 

330 

630 

45 

345 

630 

46 

■Ij 

360 

630 

47 

375 

630 

48 

390 

630 

49 

405 

630 

50 

420 

630 

51 

435 

630 

52 

450 

630 

53 

465 

630 

54 

480 

630 

55 

495 

>» 

-*-> 

630 

56 

510 

jB 

630 

57 
58 

525 
540 

3 

630 
630 

r$525 
525 

59 

540 

630 

525 

60 

540 

630 

525 

61 

•   540 

630 

d 

.2 

525 

62 

"  600 

630 

"5 

525 

63 

i 

615 

630 

s< 

525 

64 

■a 

I 

630 

630 

B 

8. 

525 

65 

645 

630 

525 

66 

660 

630 

r/) 

525 

67 

1 

675 

630 

525 

68 

3 

690 

630 

525 

69 

705 

630 

525 

70 

I  720 

I  630 

L   525 

'NEW 


JERSEY' 


11 


Table  4 — Approximate  Amount  of  Retirement  Allowance  Which  a  New  Entrant  Would  Receive  on  the  Basis  of 

l/70th  of  the  Average  Salary  of  the  5  Years  Preceding  Retirement  for  Each  Year  of  Service 

($14.28  Per  Year)  If  His  Salary  Advanced  During  His  Career  at  the  Average  Rate. 

Note. — The  superannuation  allowance  is  minimum  MOO.  The  disability  allowance  is  minimum  $300.  The  latter  allowance  can 
in  no  case  exceed  9/10ths  of  the  allowance  which  the  teacher  would  have  received  had  he  continued  until  62.  The  two  lines 
indicate,  one,  the  points  at  which  the  allowance  exceeds  half-pay;  the  other,  the  points  at  which  it  is  above  the  minimum. 


Age  at 
Entrance 

Disability 

Allowance  en  Retirement  at 

Aae 

Approximate  Amount  of  Superannuation  Allowance     _APe  ** 
_.....                                           Entrance 

into  the 

on   Retirement  at 

Age: 

Into  the 

New  Fund 

55 

56 

57 

58 

59 

60 

61 

62 

63            64 

66 

68 

67 

New  Fune" 

22 

$471 

$486 

|  $500 

$514 

$514 

$514 

$514 

$571      $585      $600 

$614 

$628 

$643 

22 

23 

457 

471 

486 

|  500 

501 

501 

501 

557 

571        585 

600 

614 

628 

23 

24 

443 

457 

471 

486 

488 

488 

488 

543 

5*7        571 

585 

600 

614 

24 

2-5 

428 

443 

457 

471 

476 

476 

476 

528 

543        557 

671 

585 

600 

25 

26 

414 

418 

443 

457 

463 

463 

463 

514 

528        543 

557 

571 

585 

26 

27 

400 

414 

428 

443 

450 

450 

460 

|  500 

514        528 

543 

557 

571 

27 

28 

386 

400 

414 

428 

437 

437 

437 

486      | 

500        514 

528 

543 

657 

28 

29 

371 

386 

400 

414 

424 

424 

424 

471 

486      |  500 

514 

528 

543 

29 

30 

357 

371 

386 

400 

411 

411 

411 

457 

471        486 

|  500 

514 

628 

30 

31 

343 

357 

371 

386 

398 

39$ 

398 

443 

457        471 

486 

|  500 

514 

31 

32 

328 

343 

357 

371 

386 

386 

386 

428 

443        457 

471 

486 

|  500 

32 

33 

|  314 

328 

343 

357 

371 

372 

373 

|414 

428        443 

457 

471 

486 

33 

34 

300 

|  314 

328 

343 

357 

360 

360 

400      | 

414        428 

443 

457 

471 

34 

35 

300 

300 

|  314 

328 

343 

357 

360 

400 

400      | 414 

428 

443 

457 

36 

36 

30i0 

300 

300 

|  314 

328 

343 

857 

400 

400        400 

1414 

428 

44S 

36 

37 

300 

300 

300 

300 

|  314 

328 

343 

400 

400        400 

400 

|  414 

428 

37 

38 

300 

300 

300 

300 

300 

|  314 

328 

400 

400        400 

400 

400 

1414 

38 

39 

300 

300 

300 

300 

300 

300 

|  314 

400 

400        400 

400 

400 

400 

39 

40 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

40 

41 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

41 

42 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

42 

43 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

43 

44 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

44 

45 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

45 

46 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

46 

47 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

47 

48 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

48 

49 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

49 

50 

300 

300 

300 

300 

300 

300 

300 

400 

400        400 

400 

400 

400 

60 

Table  5 — Contribution; 

i  and  Amount 

of  Retirement 

Allowances  of  ! 

Teachers  Having  Previous 

1  Service  to 

Their 

Credit  and  Retiring  at  62  Years 

of  Age. 

Age  at 

Average  Salary 

Entrance 

Number  of 

Annual  Contribution 

of  5  Years 

Retl 

rement  Allowance 

Reserve 

into 

Years 

of 

(Percentage  of  Salary) 

Preceding 

Fraction 

(Actuarial  Equivalent) 

the  Fund 

Prior  Service 

Men 

Women 

Retirement 

of  Salary                 Ai 

mount 

Men 

Women 

25 

3 

3.62 

4.AK 

[  $1,400 

40/70                    $800 

$7,029 

$8,585 

700 

40/70 

400 

3,514 

4,292 

30 

7 

3.76 

|«» 

\     1.4( 

39/70 

780 

6,853 

8,370 

700 

minimum 

400 

3,514 

4,292 

40 

15 

4.26 

5.1  9 

I     1.4C 

37/70 

740 

6,492 

7,941 

700 

minimum 

400 

3,514 

4,292 

50 

30 

5.01 

6.1  K 

\    1.4( 

42/70 

840 

7,380 

9,014 

700 

42/70 

420 

3,690 

4,507 

60 

40 

6.00 

7.,Q 

\    1,4( 

42/70 

840 

7,380 

9,014 

700 

42/70 

420 

3,690 

4,507 

Table  6 — Amount  of  Reserve  Necessary 

to  Provide  a  Certain  Retirement  Allowance  at  a 

Certain  Age, 

Amount  of 

MEN 

Retirement 

Reserve  Necessary  at  Retirement  Age: 

Allowance 

55 

56 

57 

58 

59 

60 

61 

62 

63              64 

65 

66 

67 

68 

$400 

14,133      J 

*4,050 

$3,966 

$3,879 

$3,790 

$3, 

700 

$3,608 

$3,514 

$3,420      $3,324      $3,226 

$3,128    i 

13,029 

$2,930 

500 

5,166 

5,062 

4,957 

4.848 

4,738 

4, 

625 

4,510 

4,393 

4,274        4,154 

4,033 

3,910 

3,786 

3,662 

600 

6,199 

6,075 

5,948 

5,818 

5,686 

5,550 

5,412 

5,272 

5,129        4,985 

4,840 

4,692 

4,544 

4394 

700 

7,232 

7,087 

6,940 

6,788 

6,633 

6,475 

6,314 

6,150 

5,984        5,816 

5,646 

5,474 

5,301 

5,127 

800 

8,266 

8,100 

7,931 

7,758 

7^81 

7,400 

7,216 

7,029 

6,839        6,647 

6,453 

6,256 

6,058 

5,859 

900 

9,299 

9,112 

8,923 

8,727 

8,528 

8,325 

8,118 

7,907 

7,694        7,478 

7,259 

7,038 

6,816 

6,592 

1,000 

10,332 

10,125 

9,914 

9,697 

9,476 

9,250 

9,020 

8,786 

8,549        8,309 

8,066 

7,820 

7,573 

7,324 

Amount  of 

WOMEN 

Retirement 

Reserve 

Necessary  at  Retirement  Age: 

Allowance 

i      55 

56 

57 

58 

59 

60 

61 

62 

63              64 

65 

66 

67 

68 

$400 

$5,129      ! 

15,015 

$4,898 

$4,780 

$4,660 

$4,539 

$4,416 

$4,292 

$4,168      $4,042      $3,916      ! 

B3,789    $3,662 

$3,535 

500 

6,412 

6,269 

6,123 

5,975 

5,825 

5,674 

5,520 

5,366 

5,210        5,053 

4,895 

4,736 

4.578 

4,419 

600 

7,694 

7,522 

7,348 

7,170 

6,990 

6,808 

6,624 

6,439 

6,251        6,063 

5,873 

5,683 

5,493 

5303 

700 

8,976 

8,776 

8,572 

8,365 

8,155 

7,943 

7,728 

7,512 

7,293        7,074 

6,852 

6,630 

6,409 

6,187 

800 

10,258 

10,030 

9,797 

9,560 

9^20 

9,078 

8,832 

8,585 

8,335        8,084 

7,831 

7,578 

7,324 

7,07» 

900 

11341 

11,283 

11,021 

10,755 

10,485 

10,212 

9,936 

9,658 

9,377        9,095 

8,810 

8,525 

8.240 

7,954 

1,000 

12,823 

12,537 

12,246 

11,950 

11,650 

11, 

,347 

11,040 

10,731 

10,419      10,105 

9,789 

9,472 

9,155 

8,838 

12 


'NEW 


JERSEY' 


Table  7 — Proposed  Retirement  Plan.     Valuation  of  the  Assets  and  Liabilities  of  the  State,  If  Every  Teacher  In 

the  State  Elected  to  Enter  the  System. 

NOTE — The  liabilities  are  calculated  on  the  basis  of  the  plan  originally  proposed — allowances  computed  on  the  basis  of  10 
year  average  salary,  disability  allowances  at  l/75th  rate  of  salary,  no  minimum  amount  of  benefits. 


LIABILITIES 
Service  pensions  of  present  pension  fund  to 
be  continued: 

Men    $    463,478 

Women 1,677,371    $2,140,849 

Disability  pensions  to  be  granted 
to  annuitants  of  retirement 
fund  who  are  not  now  drawing 
pensions,  in  order  to  guarantee 
continuation  of  present  annu- 
ities: 

Men    $     133,101 

Women 556,407         689,508 


ASSETS 
Appropriations  to  be  made  by  State. 


.$21,585,987 


Total  pensions  to  teachers  now  retired $   2,830,357 

Service  allowances  on 
account  of  future 
service  to  teachers 
now  in  service  who 
remain  to  retire  on 
service  allowances: 

Men  $2,337,454 

Women..  8,177,068$10,514,522 
Less  approximately 
one-half  of  allow- 
ance provided  by 
contribu  t  i  o  n  s  of 
teachers: 

Men  $1,168,727 

Women..   4,088,534      5,257,261 
Net     service     allow- 
ances   on    account 
of     future     service 
provided  by  state: 

Men  $1,168,727 

Women..   4,088,534  $5,257,261 

Additional  service  al- 
lowances on  ac- 
count of  prior 
service  of  present 
teachers  to  be  pro- 
vided by  state: 

Men  $2,020,661 

Women..   6,146,966  8,167,627 

Total  disability  allow- 
ances payable  to 
teachers  now  in 
service  who  become 
disabled: 

Men  $     447,352 

Women..   5,608,433    $6,055,785 
Less  part  of  disabil- 
ity allowances  pro- 
vided by  contribu- 
tions of  teachers: 

Men  $       93,884 

Women..       945,808      1,039,692 
Net  disability  allow- 
ance   provided    by 
state: 

Men  $     353,468 

Women..   4,662,625  5,016,093 

Special  annuity  bene- 
fits allowable  on 
service  retirement 
on  account  of  con- 
tributions to  Teach- 
ers' Retire  m  e  n  t 
Fund: 

Men  $       43,809 

Women..       270,840  314,649 


Total  pensions  to  present  teachers $18,755,63© 


Grand  Total $21,585,987 


$2.1,585,987 


'NEW  JERSEY'  13 

PART  II 

Contents  of  Proposed  Legislation 

An  act  providing  for  the  establishment  of  a  Teachers'  Pension  and  Retirement 

Fund  of  the  State  of  New  Jersey  (Amendment  of  the  Teachers' 

35-Year  Service  Pension  Law) 

Organisation  of  Fund.  Establishment.  Membership.  Administration.  Benefits.  Superannuation.  Disability. 
Death.  Resignation  or  Dismissal.  Optional  Benefits.  Additional  annuity.  Teachers  now  on  retired  list. 
Financing.  Member's  contributions.  State's  contributions.  Guarantee  of  Solvency.  Other  provisions. 
Waiver  of  rights. 


ARTICLE  I. 

Organization  of  the  Fund. 


I.  Establishment  of  Fund: 


On  September  1,  1919,  there  shall  be  created 
in  this  state  a  fund  called  the  Teachers'  Pension 
and  Retirement  Fund  of  the  State  of  New  Jersey. 

II.  Membership: 

A.  All  teachers  appointed  after  September  1, 
1919,  shall  automatically  become  members  of 
said  Fund. 

B.  All  present  teachers  who  within  a  year  after 
the  establishment  of  the  Fund  shall  elect  to  join 
it  shall  be  members  of  the  Fund.  Those  who 
are  members  of  the  Teachers'  Retirement  Fund 
must  sign  a  waiver  of  all  their  rights  under  that 
Fund  before  they  can  be  accepted  into  the  Fund 
created  by  this  act.  The  time  for  their  joining 
it  may  be  extended  by  the  Retirement  Board  sub- 
ject to  the  approval  of  the  State  Commission  into 
a  period  not  exceeding  five  years. 

III.  Administration  : 

A.  Organizatioi   of  Retirement  Board: 
( 1 )  The  Fund  shall  be  managed  by  a  Retirement 
Board  consisting  of  seven  members : 

a.  Commissioner  of  Education. 

b.  State  Treasurer. 

c.  One  member,  not  a  teacher,  appointed  by 
the  Governor  for  a  period  of  three  years, 
except  that  the  one  appointed  immediately 
after  the  passage  oi:  this  act  shall  have  a 
two  year  term. 

d.  Three  members  of  the  Fund  elected  by 
the  members  of  the  Fund  in  accordance 
with  the  rules  which  the  State  Pension 
Commission  shall  prescribe,  for  a  term  of 
three  years,  except  that  two  of  those 
elected  in  the  year  1919  shall  have  a  one, 
and  two  year  terms  respectively. 

e.  The  seventh  member  not  a  teacher  nor  an 
officer  of  the  state  elected  by  the  six  for 
a  period  of  three  years  except  that  the 
one  elected  in  1919  shall  have  a  one  year 
term. 


(2)  Until  the  organization  of  the  Fund  and  the 
election  of  three  members  therefrom,  the 
Commissioner  of  Education,  the  State  Treas- 
urer and  the  member  appointed  by  the  Gov- 
ernor shall  perform  the  duties  of  the  Re- 
tirement Board. 

(3)  A  vacancy  occurring  in  the  Retirement 
Board  shall  be  filled  for  the  unexpired  term 
by  the  appointment  or  election  of  a  succes- 
sor in  the  same  manner  as  that  of  his  prede- 
cessor. 

(4)  The  members  of  the  Board  shall  serve  on  it 
without  compensation  except  that  they  shall 
be  reimbursed  for  any  necessary  expendi- 
tures. 

(5)  The  Board  shall  engage  such  actuarial  and 
other  technical  services  as  may  be  required 
and  appoint  such  administrative  employees 
as  may  be  necessary  for  the  transaction  of 
its  business.  The  compensation  of  all  per- 
sons employed  by  the  Board  shall  be  fixed  by 
the  Board. 

(6)  The  Board  shall  have  an  office  in  such  city 
as  it  may  find  most  suitable  for  the  transac- 
tion of  its  business. 

B.  Chief  Duties  of  Retirement  Board: 

(1)  To  keep  such  data  as  shall  be  necessary  for 
actuarial  valuation  of  the  fund. 

(2)  To  certify  the  rates  of  contributions  which 
shall  be  deducted  from  the  members'  salaries 
and  also  those  which  shall  be  paid  by  the 
State. 

(3)  To  receive  contributions  and  manage,  invest, 
submit  to  periodical  valuations  and  keep  in  a 
solvent  condition  the  fund. 

(4)  To  grant  retirement  allowances  in  accord- 
ance with  the  provisions  of  this  act. 

(5)  To  make  such  reports  and  take  such  steps 
regarding  the  financing  and  management  of 
the  funds  as  the  State  Commission  shall 
prescribe. 


14 


NEW 


JERSEY 


C.  Chief  Duties  of  the  School  Authorities : 
The  chief  duties  of  the  State  Department  of 
Public  Instruction  and  of  the  branches  of  service 
in  which  the  teachers  are  employed  shall  be: 


(1)  To  furnish  the  required  records  and  infor- 
mation to  the  Retirement  Board. 

(2)  To  make  the  deductions  from  members'  sal- 
aries certified  by  the  Retirement  Board. 


ARTICLE  II. 

Benefits. 


I.  Superannuation  Benefits: 

A.  Condition  of  Allowances : 

( 1 )  A  superannuation  allowance  is  granted  upon 
the  application  of  a  member  or  at  the  request 
of  the  Board  of  Education  employing  the 
member,  who  has  attained  or  passed  the  age 
of  62. 

(2)  Retirement  is  compulsory  at  the  age  of 
seventy. 

B.  Amount  of  Allowance: 

(1)  The  amount  of  allowance  is  approximately 
equal  to  one-seventieth  of  the  average  salary 
of  the  five  years  immediately  preceding  re- 
tirement multiplied  by  the  number  of  years 
the  employee  has  been  a  member  of  the 
Fund.  For  a  member  with  more  than  thirty- 
five  years  service  the  allowance  is  more  than 
one-half  salary. 

(2)  The  allowance  consists  of  a  pension  of 
l/140th  of  the  average  salary  for  each  year 
the  employee  has  been  a  member  of  the 
Fund  and  of  an  annuity  such  as  his  contribu- 
tions will  purchase  at  the  time  of  his  retire- 
ment. Members  who  were  in  the  service 
prior  to  their  becoming  a  member  of  the  said 
fund  are  to  receive  an  additional  allowance 
of  one-seventieth  of  the  average  salary  of  the 
last  five  years  for  each  year  of  such  prior 
service  except  that 

a.  In  the  case  of  the  teachers  who  shall  delay 
their  joining  the  Fund  beyond  a  year  after 
its  establishment,  the  time  between  the 
latter  date  and  the  date  of  their  joining 
the  fund  shall  not  be  counted  for  pension 
purposes. 

(3)  The  allowance  shall  in  no  case  be  less  than 
$400. 

(4)  In  computing  the  amount  of  the  allowance, 
credit  shall  be  given  for  the  years  of  service 
rendered  in  the  public  schools  of  other  states 
up  to  a  maximum  of  10  years. 

II.  Disability  Benefit: 

A.  Condition  of  Allowance: 

(1)  An  ordinary  disability  benefit  is  payable  to 
any  member  who  is  physically  or  mentally 
incapacitated  for  duty  after  10  or  more  years 
of  service  in  New  Jersey.  The  request  for 
retirement  on  disability  may  come  either 
from  the  member  himself  or  from  the  Board 
of  Education  employing  the  member. 


B.  Amount  of  Allowance 


III. 


IV. 


(1)  The  allowance  equals  approximately  l/70th 
of  the  average  salary  of  last  5  years  for  each 
year  of  service  except  that  the  years  of 
service  which  are  reduced  or  not  counted  for 
any  superannuation  pensions  are  similarly  re- 
duced or  not  counted  for  disability  pensions. 

(2)  The  benefits  consist  of  an  annuity  such  as 
the  employee's  contributions  will  purchase 
and  of  a  pension  which  provides  the  balance. 

(3)  The  allowance  is  in  no  case  less  than  30% 
of  the  member's  average  salary,  or  $300, 
whichever  amount  shall  be  the  largest.  It 
can  in  no  case  exceed  9/10  of  the  allowance 
to  which  the  member  would  have  been  en- 
titled had  he  remained  in  the  service  until 
62  years  of  age. 

(4)  In  computing  the  amount  of  the  allowance 
credit  shall  be  given  for  the  years  of  service 
rendered  in  the  public  schools  of  other  states 
up  to  a  maximum  of  10  years. 

C.  Safeguard  Against  Abuse: 

Members  retired  on  account  of  disability  may 
be  required  to  undergo  periodical  medical  exam- 
inations. Members  whose  disabilities  are  found 
to  be  removed  are  to  have  their  allowances  re- 
duced so  that  their  earnings  and  pensions  com- 
bined shall  not  exceed  their  previous  earnings. 

Death  Benefits: 

To  the  estate  of  any  member  who  died  before 
retirement  there  shall  be  refunded  all  his  con- 
tributions together  with  interest  at  3%  com- 
pounded annually. 

Refund  of  Contributions  in  Case  of  Resig- 
nation or  Dismissal: 

A.  In  case  of  resignation  or  dismissal  from 
the  service  prior  to  retirement  the  member  shall 
receive  a  refund  of  all  his  contributions  together 
with  interest  compounded  annually  at  3%. 

B.  The  member  who  resigns  or  is  dismissed 
may  leave  his  contributions  in  the  fund  allowing 
them  to  draw  interest  and  may  withdraw  them  at 
a  later  date  or  in  case  of  re-entrance  in  the  serv- 
ice apply  them  to  the  credit  of  his  or  her  future 
benefit.  If  a  member  takes  a  leave  of  absence 
and  leaves  his  contributions  in  the  fund,  the 
state's  contribution  on  his  or  her  account  shall 
be  held  in  reserve  for  two  years,  so  that  in  case 
the  member  is  reinstated  within  that  period,  the 
member's  and  the  state's  contributions  might  con- 
tinue at  the  same  rate.     If  the  member  who  with- 


'NEW 


JERSEY' 


IS 


drew  from  the  service  returns  after  a  longer 
absence,  he  is  admitted  as  a  new  entrant  and 
must  contribute  at  a  new  rate  according  to  his 
age  at  the  time  he  re-enters  the  fund.  If  he 
desires  credit  for  the  prior  service  in  New  Jer- 
sey he  must  make  up  the  contributions  (if  he 
withdrew  them)  in  a  lump  sum  or  by  means  of 
annual  instalments  to  cover  one-half  of  the  cost 
of  the  benefits  on  that  account,  in  which  case 
the  state  will  make  up  the  other  half. 

V.    Optional  Benefits: 

Members  upon  retirement  may  elect  to  receive 
the  actuarial  equivalent  of  their  pensions  and 
annuities  in  any  one  of  the  following  forms : 

( 1 )  Total  amount  payable  in  monthly  instalments 
throughout  life,  all  payments  ending  at  death. 

(2)  Reduced  payments  during  life  with  a  provi- 
sion that  in  case  of  death  before  such  pay- 
ments have  equalled  the  present  value  of 
pension  and  annuity  at  rate  of  retirement, 
the  balance  shall  be  paid  to  the  heirs  or 
assigns. 

(3)  Reduced  payments  covering  two  lives  with 
a  provision  that  at  the  death  of  the  member 
the  same  payments  or  one-half  of  such  pay- 
ments shall  be  continued  throughout  the  life 
of  such  other  person  as  the  member  shall 
have  designated. 

(4)  Such  other  form  of  actuarial  equivalent  as 
may  be  certified  by  the  actuary  and  approved 
by  the  retirement  board. 


VI.  Additional   Annuity    For   Prior    Contribu- 
tions : 

A.  Any  teacher  who  transfers  from  the  Teach- 
ers' Retirement  Fund  to  the  fund  which  is  hereby 
established  shall  be  credited  for  annuity  purposes 
in  the  latter  fund  with  the  amount  which  he 
contributed  to  the  Retirement  Fund  and  shall  re- 
ceive on  retirement  such  an  annuity  as  this 
amount  will  purchase. 

B.  This  annuity  shall  be  paid  notwithstanding 
any  other  annuity  or  pensions  which  the  teacher 
may  receive  under  this  act. 

VII.  Provisions  For  Teachers  Now  on  the  Re- 
tired List: 

A.  The  payment  of  pensions  granted  under 
the  35  Year  Service  Pension  Act  prior  to  the 
enactment  of  this  amendment  shall  be  continued 
as  heretofore. 

B.  Any  time  any  annuity  received  from 
the  Teachers'  Retirement  Fund  by  any  teacher 
who  is  on  the  retired  list  of  said  fund  at  the  time 
of  establishment  of  the  Fund  which  is  hereby 
created,  and  who  has  not  been  a  beneficiary  of 
the  35  Year  Service  Pension  Act  is  reduced  be- 
cause of  insufficiency  of  funds,  there  shall  be 
paid  to  such  retired  teacher  from  the  fund  which 
is  hereby  established  an  additional  annuity  which 
together  with  the  reduced  annuity  shall  provide 
him  with  the  same  total  annuity  he  has  been 
receiving  heretofore. 


ARTICLE  III. 


Financing. 


I.  Contributions  by  Members: 


A.  All  new  appointees  will  contribute  from 
the  date  of  their  appointment  and  all  other  teach- 
ers who  will  join  said  fund  shall  contribute  from 
the  date  of  their  becoming  a  member.  The 
amount  of  the  contribution  is  fixed  as  a  percent- 
age of  salary  and  shall  depend  upon  the  sex  and 
the  age  of  the  member  at  the  time  of  his  entrance 
in  the  fund. 

B.  The  initial  rate  paid  by  the  member  is  to 
continue  unchanged  until  retirement  unless  al- 
tered at  the  time  of  actuarial  revaluations. 

C.  These  rates  are  computed  by  use  of  mor- 
tality and  service  experience  tables  and  interest 
tables.  Each  member  must  put  into  the  fund 
every  year  enough  so  that  when  he  reaches  the 
age  of  superannuation,  his  contribution  will  be 
sufficient  to  purchase  approximately  one-half  the 
allowance  which  is  promised.  The  cost  of  that 
allowance  is  determined  by  the  average  salary 
upon  which  it  is  based  and  upon  the  length  of 
time  the  annuity  will  be  drawn  as  shown  by  the 
mortality  table.  In  determining  the  annual  per- 
centage that  the  member  must  contribute  in  order 
that  the  accumulated  contributions  be  approx- 
imately equivalent  to  one-half  the  cost  of  the 


allowance,  consideration  is  made  of  expected  in- 
creases in  the  member's  salary  and  of  the  fact 
that  the  state  will  guarantee  that  member's  con- 
tributions shall  bear  interest  compounded  at  four 
per  cent. 

D.  Members  who  have  prior  service  at  the  time 
they  become  members  of  the  Fund  will  purchase 
one-half  the  service  allowance  due  to  future 
service,  and  the  state  will  provide  the  total  allow- 
ance due  to  past  service. 

E.  New  entrants  desiring  credit  for  service  in 
the  public  schools  of  other  states  up  to  a  maxi- 
mum of  10  years  must  contribute  half  of  the  cost 
of  the  benefit  on  that  account. 

F.  Members'  contributions  are  placed  in  a  dis- 
tinct and  separate  fund,  called  the  Annuity  Sav- 
ings Fund.     Each  member's  contributions  are 

placed  to  his  own  account  and  may  be  withdrawn 
if  he  leaves  the  service  without  purchasing  a  re-    N 
tirement  allowance. 

II.  Contributions  by  State  : 

A.  The  state  will  provide  one-half  of  the  cost 
of  the  service  allowance  to  be  granted  on  account 
of  future  service  of  the  members,  and  half  of  the 
cost  of  the  allowance  for  outside  experience  of 


16 


'NEW 


JERSEY' 


new  entrants;  all  the  allowances  to  be  granted 
on  account  of  prior  service  and  outside  experi- 
ence of  present  members ;  the  disability  pension ; 
the  additional  annuity  in  compensation  for  prior 
contributions  made  by  members  who  have  trans- 
ferred from  the  Teachers'  Retirement  Fund  to 
the  Fund  established  by  this  act ;  and  all  pensions 
granted  prior  to  the  establishment  of  the  Fund 
which  is  hereby  created.  The  state  will  also 
contribute  the  cost  of  the  minimum  benefit  pro- 
vision, the  administrative  expenses  of  the  system 
and  cover  any  deficiency  which  the  fund  may 
develop. 

B.  The  state  will  make  its  contributions  in  the 
following  way: 

(1)  To  provide  for  pensions  to  be  granted  on 
account  of  service  rendered  after  the  teach- 
ers become  members  of  the  Fund,  the  state 
will  pay  on  a  reserve  basis  a  certain  percent- 
age of  the  members'  salaries. 

(2)  To  provide  for  allowances  to  be  granted  on 
account  of  service  rendered  by  the  teachers 
prior  to  their  becoming  members  of  said 
fund,  the  state  will  contribute  on  a  reserve 
basis  such  a  percentage  of  the  salaries  of  said 
members  as  will  according  to  the  calculations 
of  the  actuary  liquidate  the  deficiency  on  that 
account  in  approximately  twenty-five  years. 


(3)  The  state  shall  appropriate  each  year  with- 
out providing  a  special  reserve: 

a.  The  amount  necessary  to  pay  the  pensions 
of  that  year  granted  prior  to  the  estab- 
lishment of  the  Fund,  which  is  hereby 
created. 

b.  The  amount  necessary  for  the  payment  of 
administrative  expenses  of  that  year. 

c.  The  additional  reserve  necessary  in  cases 
where  otherwise  the  superannuation  or 
disability  allowance  would  fall  below  the 
prescribed  minimum  of  $400  or  $300. 

III.  Provisions  For  Continued  Solvency  of  the 
Fund  : 

A.  Periodical  actuarial  valuations  of  the  funds 
are  required.  The  first  valuation  is  to  be  taken 
a  year  after  the  establishment  of  the  fund. 

B.  Contributions  of  the  state  and  of  the  mem- 
bers shall  be  actuarially  determined  and  be  equiv- 
alent to  the  cost  of  the  benefits  provided. 

C.  Reserve  funds  shall  be  maintained  by  means 
of  which  accruing  liabilities  are  provided  for 
before  they  mature. 

D.  Investment  of  Funds  is  limited  to  those 
legal  for  sinking  funds. 

E.  The  State  Pension  Commission  shall  be 
responsible  for  their  proper  administration. 


ARTICLE  IV. 
Other  Provisions. 


I.  Waiver  of  Rights  Under  Retirement  Fund 
and  Acceptance  of  This  Act: 

Any  person  who  is  now  a  member  of  the 
Teachers'  Retirement  Fund,  established  by  Chap- 
ter  of  the  Laws  of may  on 

or  before of waive 

all  rights  and  privileges  he  now  has  as  such  and 
accept  the  provisions  of  this  act  with  all  its 
rights  and  privileges  by  sending  and  delivering 
to  the  board  of  trustees  of  both  funds  a  notice 
in  the  following  form: 

"To  the  Board  of  Trustees  of  the 

Fund  of  the  State  of  New 


II. 


Jersey.  You  are  herewith  notified  that  I  here- 
by waive  all  the  rights  and  privileges  as  a  mem- 
ber of  the  Teachers'  Retirement  Fund  under 
any  provisions  of  any  retirement  act  heretofore 
passed  by  the  Legislature,  and  that  I  hereby 

accept  the  provisions  of  an  act  entitled 

and  that  I  do  hereby  agree  to 

be  bound  thereby.     Date 

A  copy  of  said  notice  shall  be  filed  with  the 

Board   of   Education  by  whom  the  teacher  is 

employed. 

Any  acts  or  parts  of  acts  inconsistent  with  this 
act  are  hereby  repealed. 


NEW  JERSEY' 

PART  III. 


17 


Actuarial  Estimates 

Cost  of  Existing  Systems  and  of  Proposed  Plan 

Provisions  of  Existing  Laws  and  Proposed  Plan.     Service   factors  considered  in   the   Valuation.     Rates   of 
Separation.     Service  and  Mortality  tables.     Annuity  values.     Procedure  in  the  valuation.     Age  distribution. 

Valuation  Balance  Sheet. 


NOTE — At  the  time  the  question  of  the  preparation  of 
an  actuarial  estimate  of  the  liabilities  of  the  Teachers' 
Retirement  Fund  and  of  the  35  Year  Service  Pension 
was  first  discussed  the  Commission  realized  that  the 
estimate  could  not  be  based  upon  the  actual  mortality 
and  rate  of  withdrawal  from  the  service  which  obtains 
among  the  New  Jersey  teachers.  It  would  have  required 
considerable  funds  and  time,  neither  of  which  were  avail- 
able, to  collect  data  regarding  the  number  of  deaths, 
resignations  and  dismissals  at  different  ages  and  after 
different  lengths  of  service,  which  have  occurred  during 
the  past  years  in  the  New  Jersey  school  system  and  to 
make  a  detailed  study  of  these  factors. 

It  was  decided,  therefore,  to  use  the  results  of  the 
exhaustive  investigations  made  in  some  other  states  of 
the  rate  of  mortality  and  withdrawal  from  the  service 
prevailing  among  the  teachers  and  to  collect  data  regard- 
ing the  ages,  salaries,  lengths  of  service  of  the  teachers 
of  New  Jersey.  Reliable  estimates  could  be  prepared  on 
such  a  basis. 

The  actuary  prepared  an  estimate  and  presented  a 
preliminary  report  based  upon  the  complete  results  of 
the  census  taken  by  the  Commission  and  then  proceeded 
to  calculate  the  cost  of  the  changes  in  the  existing  sys- 
tems which  the  Commission  proposed  to  introduce.  The 
procedure  followed  in  the  preparation  of  the  actuarial 
estimates  is  described  below.  It  is  believed  that  the 
fifigures  given  may  be  safely  employed  as  a  basis  for  the 
establishment  of  the  plan  of  reorganization,  should  such 
a  plan  be  accepted. 

PROVISIONS  OF  EXISTING  RETIREMENT  AND  PEN- 
SION LAWS  AND  PROPOSED  PLAN 
OF  REORGANIZATION. 

The  following  summaries  include  only  those  provisions 
which  were  considered  in  the  statements  of  cost  herein- 
after presented. 

Provisions  of  the  Teachers'  Retirement  Fund. 

In  considering  the  Teachers'  Retirement  Fund,  it 
seemed  advisable  to  divide  members  into  two  classes,  and 
consider  separately  the  benefits  and  contributions  to  be 
made  by  each  class. 

CLASS  I. 

In  this  class  are  teachers  who  joined  the  system  prior 
to  1906  and  1907,  and  did  not  accept  the  new  provisions 
offered  to  them  when  the  system  was  reorganized  in  1906 
and  1907. 

Benefits  of  the  System.1 

A  disability  annuity  of  50%  of  the  average  salary 
of  the  5  years  preceding  retirement  is  payable  to 
teachers  disabled  after  20  years  of  service  in  New 
Jersey.  The  minimum  annuity  is  $250  per  year, 
and  the  maximum  is  $600  per  year. 

1  The  law  also  provides  for  the  return  of  one-half  of  the 
teachers'  contributions  to  teachers  who  resign  after  5  years  of 
service.  Because  of  the  small  number  who  might  claim  this 
benefit,  It  was  not  considered  In  the  valuation. 


Support  of  the  System. 

Teachers  must  contribute  annually  1%*  of  their 
salaries  and  of  the  annuities.  A  minimum  of  20% 
of  the  first  year's  annuity  must  be  contributed  before 
retirement. 

CLASS  II. 

In  class  II.  are  all  teachers  who  are  members  of  the 
retirement  system  in  accordance  with  the  provisions  of 
the  system  after  the  reorganization  of  1906  and  1907. 

Benefits  of  the  System. 

A  disability  annuity  of  60%  of  the  average  salary 
of  the  last  5  years  preceding  retirement  is  payable  to 
teachers  disabled  after  20  years  of  service  in  New 
Jersey.  The  minimum  is  $250  per  year,  and  the 
maximum  annuity  is  $650  per  year. 

Support  of  System. 

Teachers  contribute  according  to  the  years  of 
service  at  the  time  they  became  members,  as  follows: 

Teachers  with  10  years  service  or  less  at  entrance 
must  contribute  1%  of  salary  annually.  Teachers 
with  more  than  10  years,  but  less  than  15,  must 
contribute  2%%  of  salary  annually.  Teachers  with 
15  years  of  service  and  over  at  the  time  of  entrance 
must  contribute  3%  of  salary  annually. 

Teachers  must  contribute  a  minimum  of  the  first 
year's  annuity  before  retiring,  but  the  maximum  an- 
nual contribution  is  $50,  and  the  maximum  total 
contributions  are  $1,000. 

Provisions  of  the  State  35-Year  Service  Pension  Act. 

Benefits  of  the  System. 

A  service  pension  of  one-half  the  average  salary 
of  the  last  5  years  of  service  is  provided  for 

(1)  Teachers,  teacher-clerks,  principals,  and 
persons  employed  in  any  supervisory  capacity 
in  the  public  schools,  who  complete  35  years  of 
active  service,  the  last  25  years  of  which  were 
rendered  in  the  state. 

(2)  Teachers  who  attain  age  70,  the  last  20 
years  of  service  having  been  rendered  in  the 
state. 

(3)  Teachers  who  attain  age  75,  32  years  of 
service  having  been  rendered  in  the  state. 

(4)  Teachers,  teacher-clerks,  principals,  and 
persons  employed  in  any  supervisory  capacity 
in  the  public  schools  who  are  disabled,  having 
had  35  years  of  service  in  the  state,  and  having 
attained  70  years  of  age. 

Support  of  System. 

This  system  is  supported  entirely  by  appropria- 
tions made  by  the  state,  as  the  benefits  become  pay- 
able. 

*  There  is  also  a  very  small  group  included  In  this  class  who 
contribute  2%  of  their  salaries,  according  to  amendments  to  law 
in  1902  and  1903. 


18 


•NEW 


JERSEY' 


Proposed  Reorganization  of  State  Pension.1 

Benefits  of  System. 

1.  A  service  benefit  is  payable  to  teachers  attain- 
ing age  62  of  1/70  of  the  average  salary  of  the  last 
ten  years,  multiplied  by  the  number  of  years  the 
teacher  has  taught.  Retirement  is  compulsory  at 
age  70. 

2.  A  disability  benefit  is  payable  after  10  or  more 
years  of  service  of  1/75  of  the  average  salary  of  the 
last  ten  years  multiplied  by  the  number  of  years  the 
teacher  has  taught.  The  minimum  of  3  0%  of  the 
average  salary  of  the  last  ten  years  except  that  no 
disability  allowance  is  to  exceed  8/9  of  the  allow- 
ance which  would  have  been  received  by  the  teacher, 
had  the  teacher  remained  to  obtain  a  superannua- 
tion benefit. 

3.  Return  of  teachers'  contributions  together 
with  3-%  compound  interest  is  made  to  teachers  leav- 
ing the  service  without  retirement  benefits. 

4.  Additional  disability  pensions  are  provided  in 
case  the  annuities  paid  by  the  Teachers'  Retirement 
Fund  are  reduced. 

Support  of  System. 
By  Teachers. 

Such  percentage  of  salary  as  is  sufficient  to 
provide  (1)  one-half  the  cost  of  the  super- 
annuation allowance  which  is  dependent  upon 
future  service;  (2)  the  return  of  contributions, 
with  3%  compound  interest,  at  separation  prior 
to  age  62. 
By  State. 

Such  contributions  as  are  sufficient  to  provide 
(1)  one-half  the  cost  of  the  superannuation  al- 
lowance which  is  dependent  upon  future  service, 
together  with  the  total  cost  of  the  superannua- 
tion benefit  which  is  dependent  upon  past  serv- 
ice; (2)  that  part  of  the  cost  of  the  disability 
allowance  which  is  not  provided  by  the  dis- 
abled teachers'  accumulated  contributions 
toward  the  superannuation  benefit. 

SERVICE  FACTORS  REQUIRED  TO  MAKE 
VALUATION. 

In  order  to  make  a  valuation  of  the  assets  and  liabil- 
ities of  the  retirement  plans  presented  above,  the  prob- 
able rates  at  which  New  Jersey  teachers  will  leave  the 
active  service  in  the  future  and  their  probable  mortality 
when  drawing  retirement  allowances  were  required.  As 
the  same  rates  of  separation  from  active  service  and  the 
same  rates  of  pensioners'  mortality  do  not  apply  to  both 
men  and  women,  the  men  and  women  teachers  were 
considered  in  distinct  groups  and  rates  were  derived  for 
each  group.  The  required  rates  were  summarized  as 
follows: 

(1)  Rate  of  withdrawal  from  active  service. 

(2)  Rate  of  death  in  active  service. 

(3)  Rate  of  separation  on  account  of  disability. 

(4)  Rate  of  salary  change. 

(5)  Rate  of  death  of  service  annuitants. 

(6)  Rate  of  death  of  disability  annuitants. 

Collection  of  Data. 

The  census  card  which  was  collected  by  the  Pension 
and  Retirement  Fund  Commission  from  each  teacher  and 
which  was  used  by  the  actuary  in  preparing  the  rates  of 
salary  increase,  and  the  age  and  service  distribution  of 
teachers  necessary  for  the  valuations  is  shown  below: 

ADOPTED  RATES  OF  SEPARATION. 
Active  Service  Rates. 

The  following  tables  give  the  rates  of  separation  from 
active  service  adopted  for  use  in  the  valuations. 

1  Note — Since  this  report  has  been  submitted,  several  changes 
in  the  proposed  retirement  plan  have  been  made:  the  10-year 
basis  in  considering  the  amount  of  salary  has  been  changed  to 
5  years,  the  disability  rate  increased  to  l/70th  fraction,  and  the 
interest  in  case  of  refunds  fixed  at  3%.  For  a  fuller  statement 
regarding  the  benefits  of  the  proposed  plan  see  statements  on 
pages  11  and  14. 


Table  1 — Rates  of  Separation  from  Active 
Men  Teachers. 


Service. 


Rate  of 

Rata  of 

Age 

Withdrawal 

Death 

18 

.0808 

.9024 

19 

.9220 

.0025 

2* 

.0248 

.0026 

21 

.0157 

.0928 

22 

.0263 

.0029 

23 

.0265 

.9030 

24 

.0263 

.0022 

25 

.0258 

.0033 

26 

.0250 

.0035 

27 

.0240 

.0036 

28 

.0228 

.0037 

29 

.0215 

.0039 

30 

.6203 

.0040 

31 

.0189 

.0041 

32 

.0174 

.0041 

33 

.0160 

.0942 

34 

.0147 

.0043 

35 

.9135 

.0044 

31 

.0122 

.0044 

37 

.9109 

.0045 

38 

.0097 

.0045 

39 

.9985 

.0046 

40 

.0074 

.0046 

41 

.0063 

.9047 

42 

.0054 

.0047 

43 

.0045 

.0048 

44 

.9938 

.9049 

45 

.0932 

.9050 

46 

.9027 

.0052 

47 

.0022 

.0053 

48 

.0018 

.6055 

49 

.0015 

.9057 

50 

.0011 

.0060 

51 

.0008 

.0062 

52 

.0005 

.0065 

53 

.0003 

.0069 

54 

.0090 

.0073 

55 

.9078 

56 

.0083 

57 

.9089 

58 

.9096 

59 

.0104 

69 

.9112 

61 

.0120 

62 

.0130 

63 

.9139 

64 

.9149 

65 

.0159 

66 

.0170 

67 

.0183 

68 

.0195 

C9 

.0209 

7# 

.0222 

Rate  of 

Disability 
.0005 

Rateef 

9erviee 
Retirement 

.0005 

.0005 

.0005 

.0005 

.0005 

.0095 

.0095 

.0005 

.0006 

.0006 

.9006 

.0006 

.0006 

.0096 

.0007 

.0007 

.0007 

.0007 

.0008 

.0008 

.0009 

.0010 

.9019 

.0011 

.0012 

.0014 

.0015 

.0017 

.0018 

.0020 

.0265 

.0022 

.9289 

.0025 

.0821 

.0028 

.0358 

.0031 

.0392 

.0035 

.0430 

.0039 

.9470 

.0044 

.0511 

.0049 

.0558 

.0056 

.0599 

.0063 

.0647 

.0072 

.0693 

.0682 

.0747 

.0096 

.0801 

.0119 

.0864 

.0125 

.0931 

.0142 

.1001 

.0160 

.1085 

.0180 

.1190 

.0200 

.1330 

.0223 

.1645 

.0245 

.2400 

.0270 

.9640 

The  data  available  for  use  as  a  basis  in  adopting  the 
rates  in  Tables  1  and  2  was  presented  as  the  result  of 
actuarial  investigations  of  the  service  experience  of 
teachers  in  various  retirement  systems,  namely,  the 
Teachers'  Retirement  Fund  of  the  City  of  New  York;1 
Boston  Teachers'  Retirement  Fund;*  Teachers'  Super- 
annuation Fund  of  New  Zealand;3  Elementary  School 
Teachers'  Deferred  Annuity  Fund  of  England  and  Scot- 
land." 

In  adopting  rates  for  use,  the  fact  that  monetary  values 
were  to  be  made  dependent  upon  them  was  kept  in  mind. 
Where  several  services  indicated  a  marked  similarity  in 
any  one  rate,  the  rate  adopted  followed  closely  the  one 
indicated  by  these  services.  Peculiarities  in  any  experi- 
ence which  were  evidently  characteristic  of  the  one  ser- 
vice alone  were  rejected.  An  effort  was  made  to  adopt 
such  rates  that,  when  used  in  combination,  would  form  a 
safe  and  reasonable  basis  for  estimating  the  cost  of  the 
proposed  retirement  plan. 


1  Investigated  1912-1915 
*  "  1914 


•Investigated  1912-1915 

4  "  190&-1914-1916 


'NEW 


JERSEY' 


19 


Table  2 — Rates  of  Separation  from  Active  Service. 
Women  Teachers. 


Rata  of 

Rat*  of 

Rata  of 

Rata  of 

Service 

AOS 

Withdrawal 

Death 

Olaablllty 

Retirement 

18 

.0026 

.0011 

.0005 

19 

.0063 

.0012 

.0005 

26 

.0123 

.0013 

.0005 

21 

.0214 

.0014 

.0005 

22 

.0318 

.0016 

.0005 

23 

.0563 

.0018 

.0005 

24 

.0720 

.0020 

.0005 

26 

.0760 

.0023 

.0006 

26 

.0770 

.0025 

.0006 

27 

.0752 

.0028 

.0006 

28 

.0717 

.0030 

.0007 

29 

.0668 

.0032 

.0008 

39 

.0615 

.0033 

.0008 

31 

.0548 

.0034 

.0008 

32 

.0471 

.0035 

.0009 

33 

.0393 

.0036 

.0010 

34 

.0319 

.0036 

.0010 

86 

.0262 

.0036 

.0011 

36 

.0216 

.0037 

.0012 

37 

.0177 

.0039 

.0013 

38 

.0159 

.0040 

.0016 

39 

.0133 

.0042 

.0029 

49 

.0111 

.0044 

.0045 

41 

.0090 

.0046 

.0064 

42 

.0073 

.0048 

.0088 

43 

.0055 

.0050 

.0103 

44 

.0043 

.0053 

.0110 

4* 

.0034 

.0056 

.0113 

46 

.0028 

.0059 

.0114 

.0649 

47 

.0023 

.0062 

.0114 

.0669 

48 

.0019 

.0066 

.0114 

.0693 

49 

.0018 

.0070 

.0114 

.0719 

69 

.0016 

.0076 

.0114 

.0747 

61 

.0015 

.0080 

.0114 

.0779 

52 

.0014 

.0086 

.0114 

.0812 

53 

.0013 

.0091 

.0114 

.0850 

54 

.0013 

.0097 

.0114 

.0893 

56 

.0011 

.0104 

.0114 

.0943 

66 

.0010 

.0112 

.0114 

.0998 

67 

.0009 

.0120 

.0114 

.1068 

58 

.0009 

.0129 

.0114 

.1129 

59 

.0008 

.0139 

.0114 

.1210 

69 

.0006 

.0150 

.0114 

.1308 

61 

.0005 

.0162 

.0114 

.1420 

62 

.0004 

.0176 

.0114 

.1670 

63 

.0003 

.0189 

.0114 

.1770 

64 

.0001 

.0204 

.0116 

.2090 

65 

.0001 

.0222 

.0124 

.2290 

66 

.0000 

.0240 

.0147 

.2700 

67 

.0262 

.0177 

.3281 

68 

.0289 

.0215 

.4321 

69 

.0324 

.0263 

.6563 

70 

.0367 

.0329 

.9633 

Rates  for  Men  Teachers. 

The  rate  of  withdrawal  from  active  service  adopted  for 
use  in  valuing  benefits  to  men  teachers  in  New  Jersey  Is  a 
rate  somewhat  similar  to  that  obtaining  among  New  York 
City  men  teachers.  It  lies  between  the  rate  applying  to 
men  teachers  in  New  Zealand,  which  is  a  comparatively 
high  rate,  and  that  applying  to  English  and  Scottish 
teachers,  which  is  a  comparatively  low  rate.  The  death 
rate  assumed  to  reflect  the  mortality  of  men  teachers  is  a 
higher  rate  of  death  than  that  based  on  the  experience 
of  New  York  City  teachers  with  the  exception  of  the  rate 
from  age  30  to  age  38.  It  is  a  lower  rate  than  that  de- 
rived from  the  experience  of  English  Elementary  Teach- 
ers by  King  in  1906,  but  is  somewhat  higher  to  about  age 
48  than  the  rate  derived  for  that  service  by  Hardy  in 
1914.  The  rate  of  disability  for  men  teachers  of  New 
Jersey  is  higher  than  the  rate  for  New  York  City  teachers 
but  lower  than  that  based  on  the  experience  of  English 


and  Scottish  teachers.  The  rate  of  service  retirement  is 
one  based  upon  the  experience  of  New  York  City  teachers. 
This  rate  was  employed  In  valuing  all  retirement  benefits 
payable  after  35  years  of  service,  with  the  exception  that 
an  assumption  was  made  that  only  nine-tenths  of  the  re- 
tirements assumed  to  occur  according  to  the  rate  would 
actuaHy  be  granted  in  the  case  of  retirements  through 
disability  after  35  years  of  service  under  the  Teachers' 
Retirement  Fund.  The  rate  of  death  after  eligibility  for 
retirement  is  also  based  upon  that  experience.  It  is  pub- 
lished in  Part  II.  of  the  Report  of  the  Commission  on 
Pensions  of  New  York. 

Rates  for  Women. 

The  rates  adopted  for  the  valuation  of  benefits  to 
women  teachers  follow  closely  those  employed  recently 
by  David  P.  Fackler,  actuary,  in  the  preparation  of  an 
estimate  of  the  liabilities  of  the  Teachers'  Retirement 
Fund  of  New  Jersey.  The  rate  of  withdrawal  employed 
by  him  is  26%  higher  than  the  one  found  to  obtain 
among  women  teachers  in  New  York  City.  This  rate  to 
age  38,  is  a  rate  of  withdrawal  from  all  causes  including 
disability.  The  rate  of  withdrawal  adopted  for  women 
teachers  is  one  based  upon  the  rates  used  by  Mr.  Fackler, 
but  covers  only  those  causes  of  withdrawal  which  were 
assumed  to  have  occurred  through  resignation  and 
dismissal. 

The  rate  of  disability  is  based  upon  the  experience  of 
New  York  City  teachers  to  about  age  46  where  the  as- 
sumption is  made  that,  unlike  the  latter  rate,  it  is  not 
influenced  by  early  service  retirements,  and  continues 
to  increase.  The  rate  of  death  in  active  service  and  the 
rate  of  retirement  upon  eligibility  are  based  upon  the 
experience  of  New  York  City  teachers.  As  in  the  case  of 
valuing  benefits  to  men  teachers,  the  assumption  was 
made  that  only  nine-tenths  of  the  retirements  assumed  to 
occur  according  to  the  rate  would  actually  be  granted  in 
the  case  of  retirements  through  disability  after  35  years 
of  service  under  the  Teachers'  Retirement  Fund. 

Pensioners'  Mortality  Rates. 

The  following  table  shows  the  rates  of  mortality  which 
were  assumed  to  reflect  the  death  rates  of  pensioners 
among  New  Jersey  teachers.  These  rates  are  those  found 
to  obtain  among  service  pensioners  in  New  York  City. 


Table  3. — Service  Pensioners'  Mortality  Rates. 


Ago 

50 
51 
52 
53 
54 
55 
56 
57 
58 
59 
60 
61 
62 
63 
64 
65 
66 
67 
68 
69 
70 
71 
72 
73 
74 
75 
76 
77 


Men 

.0335 
.0342 
.0350 
.0358 
.0367 
.0377 
.0387 
.0399 
.0412 
.0426 
.0441 
.0458 
.0477 
.0497 
.0619 
.0543 
.0569 
.0599 
.0630 
.0665 
.0702 
.0743 
.0789 
.0837 
.0391 
.0949 
.1013 
.1082 


Women 

.0134 
.0140 
.0146 
.0153 
.0161 
.0169 
.0178 
.0188 
.0199 
.0212 
.0225 
.0239 
.0255 
.0273 
.0292 
.0313 
.0335 
.0361 
.0388 
.0418 
.0450 
.0486 
.0525 
.0667 
.0614 
.0664 
.0720 
.0780 


Ago 

78 

79 

80 

81 

82 

83 

84 

85 

86 

8.7 

88 

89 

90 

91 

92 

93 

94 

95 

96 

97 

98 

99 

100 

101 

102 

103 

104 

106 


Men 

.1156 
.1238 
.1328 
.1423 
.1528 
.1640 
.1762 
.1895 
.2033 
.2189 
.2355 
.2528 
.2717 
.2918 
.3132 
.3360 
.3600 
.3855 
.4121 
.4399 
.4691 
.4994 
.5303 
.6000 
.8000 


Vr  •lYWJrl 

.0846 
.0916 
.0994 
.1078 
.1170 
.1268 
.1376 
.1492 
.1618 
.1753 
.1900 
.2067 
.2226 
.2409 
.2600 
.2810 
.3029 
.3262 
.3510 
.3771 
.4045 
.4331 
.4629 
.4938 
.5256 
.6584 
.5916 
.6600 


20 


•NEW 


JERSEY' 


Table  4. — Disability  Pensioners' 


Age 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
35 
36 
37 
38 
39 
40 
41 
42 
43 
44 
45 
46 
47 
48 
49 
50 
51 
52 
53 
54 
55 
56 
57 
58 
59 
60 


Men 
.06096 
.06086 
.05718 
.05122 
.04470 
.03911 
.03521 
.03294 
.03187 
.03150 
.03145 
.03151 
.03162 
.03176 
.03191 
.03208 
.03226 
.03246 
.03267 
.03292 
.03317 
.03346 
.03377 
.03412 
.03449 
.03491 
.03536 
.03586 
.03640 
.03700 
.03764 
.03838 
.03915 
.04001 
.04095 
.04198 
.04312 
.04435 
.04571 
.04720 
.04881 


Women 
.03695 
.03617 
.03526 
.03425 
.03318 
.03203 
.03087 
.02973 
.02864 
.02763 
.02674 
.02598 
.02536 
.02488 
.02457 
.02438 
.02429 
.02430 
.02440 
.02456 
.02475 
.02502 
.02528 
.02559 
.02595 
.02632 
.02674 
.02719 
.02770 
.02825 
.02885 
.02950 
.03024 
.03102 
.03189 
.03285 
.03388 
.03503 
.03628 
.03764 
.03914 


Age 
61 
62 
63 
64 
65 
66 
67 
68 
69 
70 
71 
72 
73 
74 
75 
76 
77 
78 
79 
80 
81 
82 
83 
84 
85 
86 
87 
88 
89 
90 
91 
92 
93 
94 
95 
96 
97 
98 
99 
100 
101 


Mortality 

Men 

.05059 
.05253 
.05466 
.05700 
.05952 
.06238 
.06536 
.06866 
.07232 
.07269 
.08061 
.08532 
.09045 
.09610 
.10224 
.10884 
.11615 
.12393 
.13261 
.14172 
.15198 
.16275 
.17452 
.18735 
.20093 
.21584 
.23170 
.24910 
.26707 
.28668 
.30742 
.32964 
.35308 
.37801 
.40395 
.43129 
.45997 
.48922 
.52032 
.55171 
.58364 


Rates. 

Women 
.04078 
.04258 
.04452 
.04670 
.04902 
.05160 
.05444 
.05747 
.06084 
.06450 
.06849 
.07287 
.07767 
.08286 
.08847 
.09470 
.10143 
.10872 
.11668 
.12528 
.13462 
.14490 
.15575 
.16776 
.18069 
.19432 
.20955 
.22545 
.24281 
.26079 
.28110 
.30183 
.32437 
.34780 
.37298 
.39925 
.42681 
.45567 
.48559 
.51648 
.54824 


Table  5 — Continued. 


SERVICE  AND  MORTALITY  TABLES. 

The  following  active  service  tables  were  constructed  on 
the  basis  of  rates  given  in  Tables  1  and  2  respectively. 
The  salary  scales  were  based  upon  rates  of  salary  increase 
found  to  obtain  among  teachers  in  New  Jersey. 

Table  5. — Active  Service  Table.     Men  Teachers. 


Disability 

Salary 

Age 

Living 

Withdrawal 

Is   Cases 

Deaths 

Scale 

18 

100,000 

2,080 

50 

240 

530 

19 

97,630 

2,148 

49. 

244 

615 

20 

95,189 

2,361 

48 

247 

694 

21 

92,533 

2,378 

46 

259 

772 

22 

89,850 

2,363 

45 

261 

849 

23 

87,181 

2,310 

43 

262 

920 

24 

84,566 

2,224 

42 

271 

990 

25 

82,029 

2,114 

41 

273 

1,060 

26 

79,601 

1,994 

39 

275 

1,130 

27 

77,293 

1,861 

41 

278 

1,200 

28 

75,113 

1,712 

43 

281 

1,270 

29 

73,077 

1,572 

44 

284 

1,330 

30 

71,177 

1,442 

45 

285 

1,390 

31 

69,405 

1,307 

46 

285 

1,450 

32 

67,767 

1,170 

47 

281 

1,510 

33 

66,269 

1,057 

48 

280 

1,560 

34 

64,884 

952 

49 

277 

1,605 

35 

63,606 

859 

50 

274 

1,650 

36 

62,423 

758 

51 

271 

1,695 

37 

61,343 

672 

52 

270 

1,735 

38 

60,349 

582 

53 

270 

1,775 

39 

59,444 

508 

54 

279 

1,812 

40 

58,612 

435 

58 

269 

1,845 

41 

57,850 

366 

59 

269 

1,875 

42 

57,156 

309 

62 

269 

1,905 

43 

56,516 

254 

68 

271 

1,935 

44 

55,923 

213 

71 

274 

1,965 

45 

55,358 

177 

83 

277 

1,990 

46 

54,821 

148 

93 

285 

2,015 

47  54,295  119 

48  53,790  97 

49  53,290  80 

50  52,789  58 

51  52,282  42 

52  51,769  26 

53  51,247  15 

54  50,699 

55  50,131 

56  49,519 

57  48,865 

58  48,156 

59  47,390 

60  46,556 

61  45,653 

62  44,666 

63  43,594 

64  42,443 

65  41,208 

66  39,893 

67  38,497 

68  37,023 

69  35,475 

70  33,865 
Table  6. — Active  Service  Table 


98  288  2,040 

107  296  2,065 

117  304  2,085 

132  317  2,105 

147  324  2,125 

160  336  2,145 

179  354  2,165 

198  370  2,180 

221  391  2,195 

243  411  2,205 

274  435  2,215 

304  462  2,225 

341  493  2,235 

382  521  2,245 

438  549  2,250 

491  581  2,255 

545  606  2,260 

603  632  2,265 

660  655  2,270 

718  678  2,275 

769  705  2,280 

826  722  2,285 

869  741  2,290 
2,295 
Women  Teachers. 


Age 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
35 
36 
37 
38 
39 
40 
41 
42 
43 
44 
45 
46 
47 
48 
49 
50 
51 
52 
53 
54 
55 
56 
57 
58 
59 
60 
61 
62 
63 
64 
65 
66 
67 
68 
69 
70 


Living 
100,000 
99,580 
98,783 
97,390 
95,121 
91,896 
86,502 
80,049 
73,733 
67,827 
62,495 
57,783 
53,692 
50,170 
47,210 
44,779 
42,813 
41,250 
39,975 
38,916 
38,025 
37,207 
36,448 
35,719 
35,005 
34,273 
33,560 
32,869 
32,202 
31,555 
30,927 
30,312 
29,700 
29,091 
28,483 
27,876 
27,268 
26,657 
26,047 
25,432 
24,814 
24,189 
23,558 
22,922 
22,278 
21,625 
20,963 
20,290 
19,586 
18,828 
18,002 
17,095 
16,091 


Disability 
Withdrawals      Cases 
260 


628 

1,216 

2,084 

3,025 

5,182 

6,233 

6,086 

5,678 

5,098 

4,481 

3,862 

3,302 

2,749 

2,224 

1,760 

1,364 

1,081 

863 

688 

605 

495 

405 

321 

256 

189 

144 

112 

90 

72 

59 

54 

47 

43 

40 

36 

35 

29 

26 

23 

22 

19 

14 

11 

9 

6 

2 

...  2 


50 

50 

49 

49 

48 

47 

47 

46 

44 

44 

44 

44 

43 

40 

42 

45 

45 

45 

48 

51 

61 

108 

164 

229 

308 

353 

369 

371 

367 

360 

352 

346 

339 

332 

325 

318 

311 

304 

297 

290 

283 

276 

269 

262 

254 

247 

243 

252 

28-8 

333 

387 

450 


Deaths 
110 
119 
128 
136 
152 
165 
173 
184 
184 
190 
187 
185 
177 
171 
165 
161 
154 
149 
148 
152 
152 
156 
160 
164 
168 
171 
178 
184 
190 
196 
204 
212 
223 
233 
242 
254 
265 
277 
292 
305 
320 
336 
353 
371 
390 
409 
428 
450 
470 
493 
520 
554 


Salary 

Scale 

513 

528 

543 

566 

592 

622 

659 

699 

740 

780 

815 

845 

870 

890 

910 

930 

950 

970 

990 

1,000 

1,010 

1,020 

1,030 

1,040 

1,050 

1,055 

1,060 

1,065 

1,070 

1,080 

1,085 

1,890 

1,095 

1,100 

1,110 

1,115 

1,120 

l,13i 

1,140 

1,145 

1,150 

1,160 

1,165 

1,175 

1,181 

1,190 

1,200 

1,208 

1,215 

1,220 

1,280 

1,235 

1,240 


'NEW 


JERSEY' 


21 


RETIREMENT  TARLES. 

The  active  service  tables  trace  the  history  of  teachers 
until  they  become  eligible  to  retire.  The  retirement 
tables  continue  the  history  of  teachers  from  that  time 
until  they  leave  the  service. 

Table  7. — Retirement  Table.     Men  Teachers. 


Table  9 — Continued. 


Age 

Living 

Dying 

Retirements 

48 

100,000 

350 

2,550 

49 

97,100 

369 

2,806 

50 

93,925 

424 

3,015 

51 

90,486 

443 

3,240 

62 

86,803 

458 

3,403 

53 

82,942 

474 

3,567 

54 

78,901 

491 

3,708 

55 

74,702 

519 

3,817 

56 

70,366 

562 

3,891 

57 

65,913 

578 

3,948 

58 

61,387 

589 

3,972 

59 

56,826 

593 

3,938 

60 

52,295 

593 

3,906 

61 

47,796 

642 

3,828 

62 

43,326 

673 

3,744 

63 

38,909 

700 

3,623 

64 

34,586 

719 

3,462 

65 

30,405 

711 

3,299 

66 

26,395 

677 

3,141 

67 

22,577 

643 

3,003 

68 

18,931 

602 

3,114 

69 

15,215 

514 

3,652 

70 

11,049 

398 

10,651 

Table  8. 

— Retirement  Table, 

Women 

Teachers. 

Age 

Living 

Dying 

Retirements 

46 

100,000 

590 

6,490 

47 

92,920 

580 

6,216 

48 

86,124 

569 

6,969 

49 

79,586 

559 

5,722 

50 

73,305 

547 

5,476 

51 

67,282 

535 

5,241 

52 

61,506 

522 

4,994 

53 

55,990 

508 

4,759 

54 

50,723 

493 

4,529 

55 

45,701 

475 

4,310 

56 

40,916 

457 

4,083 

57 

36,376 

437 

3,848 

58 

32,091 

414 

3,623 

5  9 

28,054 

390 

3,394 

60 

24,270 

364 

3,174 

61 

20,732 

335 

2,944 

62 

17,453 

305 

2,740 

63 

14,408 

272 

2,550 

64 

11,586 

237 

2,317 

65 

9,032 

200 

2,068 

66 

6,764 

162 

1,826 

67 

4,776 

124 

1,567 

68 

3,085 

87 

1,333 

69 

1,665 

51 

1,091 

70 

523 

17 

506 

MORTALITY  TARL.ES. 

The  following  table  is  based  upon  the  rates  of  mortality 
adopted  for  pensioners. 

Table  9. — Mortality  Table  for  Service  Pensioners. 


ME 

:n 

WOMEN 

Age 

Living 

Dying 

Living 

Dying 

50 

66,715 

2,237 

75,857 

1,014 

51 

64,478 

2,206 

74,843 

1,044 

52 

62,272 

2,177 

73,799 

1,076 

53 

60,095 

2,150 

72,723 

1,112 

54 

57,945 

2,125 

71,611 

1,150 

55 

55,820 

2,102 

70,461 

1,191 

56 

53,718 

2,080 

69,270 

1,235 

57 

51,638 

2,060 

68,035 

1,282 

58 

49,578 

2,042 

56,753 

1,331 

59 

47,536 

2,024 

65,422 

1,384 

60 

45,512 

2,009 

64,038 

1,440 

61 

43,503 

1,993 

62,598 

1,498 

62 

41,510 

1,979 

61,100 

1,560 

63 

39,531 

1,964 

59,540 

1,624 

64 

37,567 

1,949 

57,916 

1,690 

65 

35,618 

1,935 

56,226 

1,758 

66 

33,683 

1,918 

54,468 

1,827 

67 

31,765 

1,902 

52,641 

1,898 

68 

29,863 

1,881 

50,743 

1,968 

69 

27,982 

1,860 

48,775 

2,037 

70 

26,122 

1,835 

46,738 

2,104 

71 

24,287 

1,805 

44,634 

2,169 

72 

22,482 

1,773 

42,465 

2,228 

73 

20,709 

1,734 

40,237 

2,283 

74 

18,975 

1,691 

37,954 

2,329 

75 

17,284 

1,640 

35,625 

2,367 

76 

15,644 

1,584 

33,258 

2,393 

77 

14,060 

1,521 

30,865 

2,406 

78 

12,539 

1,450 

28,459 

2,405 

79 

11,089 

1,373 

26,054 

2,387 

80 

9,716 

1,290 

23,667 

2,352 

81 

8,426 

1,199 

21,315 

2,298 

82 

7,227 

1,104 

19,017 

2,224 

83 

6,123 

1,004 

16,793 

2,130 

84 

5,119 

902 

14,663 

2,018 

85 

4,217 

799 

12,645 

1,887 

86 

3,418 

695 

10,758 

1,741 

87 

2,723 

596 

9,017 

1,581 

88 

2,127 

501 

7,436 

1,413 

89 

1,626 

411 

6,023 

1,239 

90 

1,215 

330 

4,784 

1,065 

91 

885 

258 

3,719 

896 

92 

627 

196 

2,823 

734 

93 

430 

145 

2,089 

587 

94 

286 

103 

1,502 

455 

95 

183 

71 

1,047 

342 

96 

112 

46 

705 

247 

97 

66 

29 

458 

173 

98 

37 

17 

285 

115 

99 

20 

10 

170 

74 

100 

10 

5 

96 

45 

101 

5 

3 

61 

25 

102 

2 

2 

26 

14 

103 

12 

7 

104 

5 

3 

105 

2 

2 

Table 

10. — Mortality  Tables  for  Disability  Pensioners. 

MEN 

WOMEN 

Age 

Living 

Dying 

Living 

Dying 

20 

216,110 

13,173 

150,277 

5,553 

21 

202,937 

12,351 

144,724 

5,235 

22 

190,586 

10,898 

139,489 

4,919 

23 

179,688 

9,203 

134,570 

4,609 

24 

170,485 

7,621 

129,961 

4,312 

25 

162,864 

6,370 

125,649 

4,024 

26 

156,494 

5,510 

121,625 

3,755 

27 

150,984 

4,974 

117,870 

3,504 

28 

146,010 

4,654 

114,366 

3,275 

29 

141,356 

4,453 

111,091 

3,069 

30 

136,903 

4,305 

108,022 

2,888 

31 

132,598 

4,178 

105,134 

2,731 

32 

128,420 

4,061 

102,403 

2,597 

33 

124,359 

3,950 

99,806 

2,483 

34 

120,409 

3,842 

97,323 

2,391 

35 

116,567 

3,739 

94,932 

2,314 

36 

112,828 

3,640 

92,618 

2,250 

37 

109,188 

3,544 

90,368 

2,196 

38 

105,644 

3,451 

88,172 

2,151 

39 

102,193 

3,364 

86,021 

2,113 

40 

98,829 

3,27*8 

83,908 

2,077 

41 

95,551 

3,197 

81,831 

2,047 

42 

92,354 

3,119 

79,784 

2,017 

43 

89,235 

3,045 

77,767 

1,990 

44 

86,190 

2,973 

75,777 

1,966 

45 

83,217 

2,905 

73,811 

1,943 

46 

80,312 

2,840 

71,863 

1,922 

47 

77,472 

2,778 

69,946 

1,902 

48 

74,694 

2,719 

68,044 

1,885 

49 

71,975 

2,663 

66,159 

1,869 

50 

69,312 

2,609 

64,290 

1,855 

51 

66,703 

2,560 

62,435 

1,842 

52 

64,143 

2,511 

60,593 

1,832 

53 

61,632 

2,466 

58,761 

1,823 

54 

59,166 

2,423 

56,938 

1,816 

55 

56,743 

2,382 

55,122 

1,811 

22 


'NEW 


JERSEY' 


Table  10 — Continued. 


Table  11 — Continued. 


MEN 


Age 

Living 

Dying 

56 

54,361 

2,344 

57 

52,017 

2,307 

58 

49,710 

2,272 

59 

47,438 

2,239 

60 

45,199 

2,206 

61 

42,993 

2,175 

62 

40,818 

2,144 

63 

38,674 

2,114 

64 

36,560 

2,084 

65 

34,476 

2,052 

66 

32,424 

2,021 

67 

30,403 

1,987 

68 

28,416 

1,951 

69 

26,465 

1,914 

70 

24,551 

1,873 

71 

22,678 

1,828 

72 

20,850 

1,779 

73 

19,071 

1,725 

74 

17,346 

1,667 

75 

15,679 

1,603 

76 

14,076 

1,532 

77 

12,544 

1,457 

78 

11,087 

1,374 

79 

9,713 

1,288 

80 

8,425 

1,194 

81 

7,231 

1,099 

82 

6,132 

998 

83 

5,134 

896 

84 

4,238 

794 

85 

3,444 

692 

86 

2,752 

594 

87 

2,158 

500 

88 

1,658 

413 

89 

1,245 

333 

90 

912 

262 

91 

651 

200 

92 

451 

149 

93 

302 

107 

94 

195 

74 

95 

122 

50 

96 

72 

31 

97 

41 

19 

98 

22 

11 

99 

11 

6 

100 

5 

3 

101 

2 

1 

102 

1 

1 

103 

WOM 

Living 

53,311 

51,505 

49,701 

47,898 

46,095 

44,291 

42,485 

40,676 

38,865 

37,050 

35,234 

33,416 

31,597 

29,781 

27,969 

26,165 

24,373 

22,597 

20,842 

19,115 

17,424 

15,774 

14,174 

12,633 

11,159 

9,761 

8,447 

7,223 

6,098 

5,079 

4,158 

3,350 

2,648 

2,051 

1,553 

1,148 

825 

576 

389 

254 

159 

96 

55 

30 

15 

7 

3 

1 


EN 

Dying 

1,806 

1,804 

1,803 

1,803 

1,804 

1,806 

1,809 

1,811 

1,815 

1,816 

1,818 

1,819 

1,816 

1,812 

1,804 

1,792 

1,776 

1,755 

1,727 

1,691 

1,650 

1,600 

1,541 

1,474 

1,398 

1,314 

1,224 

1,125 

1,023 

921 

808 

702 

597 

498 

405 

323 

249 

187 

135 

95 

63 

41 

25 

15 

8 

4 

2 

1 


ANNUITY  VALUES  FOR  PENSIONERS. 

The  following  tables  give  the  annuity  values  construct- 
ed on  the  basis  of  the  mortality  tables. 
Table  11. — Annuity  Values  for  Disability  Pensioners. 


Age 

Men 

Women 

Age 

Men 

Women 

20 

12.124 

14.071 

58 

9.285 

10.144 

21 

12.373 

14.155 

59 

9.074 

9.907 

22 

12.649 

14.234 

60 

8.859 

9.666 

23 

12.901 

14.306 

61 

8.639 

9.421 

24 

13.093 

14.367 

62 

8.416 

9.172 

25 

13.210 

14.417 

63 

8.189 

8.920 

26 

13.256 

14.453 

64 

7.959 

8.665 

27 

13.250 

14.473 

65 

7.726 

8.407 

28 

13,212 

14.477 

66 

7.491 

8.148 

29 

13.156 

14.465 

67 

7.254 

7.886 

30 

13.090 

14.436 

68 

7.015 

7.624 

31 

13.019 

14.391 

69 

6.776 

7.361 

32 

12.943 

14.332 

70 

6.535 

7.097 

33 

12.864 

14.260 

71 

6.295 

6.834 

34 

M.780 

14.175 

72 

6.056 

6.572 

35 

12.692 

14.081 

73 

5.817 

6.311 

36 

12.600 

13.977 

74 

5.679 

6.053 

37 

12.503 

13.865 

75 

5.344 

5.796 

38 

12.402 

13.746 

76 

5.111 

5.543 

39 

12.296 

13.620 

77 

4.881 

5.293 

40 

12.186 

13.488 

78 

4.655 

5.048 

41 

12.070 

13.351 

79 

4.433 

4.806 

42 

11.950 

13.208 

80 

4.216 

4.570 

43 

11.824 

13.059 

81 

4.002 

4.339 

44 

11.693 

12.904 

82 

3.796 

4.114 

45 

11.556 

12.744 

83 

3.593 

3.895 

46 

11.415 

12.578 

84 

3.397 

3.683 

47 

11.267 

12.406 

85 

3.208 

3.477 

48 

11.114 

12.229 

86 

3.024 

3.279 

49 

10.956 

12.045 

87 

2.847 

3.087 

50 

10.792 

11.856 

88 

2.677 

2.904 

51 

10.622 

11.661 

89 

2.516 

2.727 

52 

10.447 

11.461 

90 

2.361 

2.559 

53 

10.267 

11.254 

91 

2.213 

2.397 

54 

10.081 

11.043 

92 

2.070 

2.244 

55 

9.890 

10.825 

93 

1.938 

2.098 

56 

9.693 

10.603 

94 

1.810 

1.961 

57 

9.492 

10.376 

95 

1.691 

1.827 

Table  12. — Annuity  Values 

for  Service  Pensioners. 

Age 

Men 

Women 

Age 

Men 

Women 

50 

11.285 

14.179 

73 

6.076 

7.271 

51 

11.105 

13.919 

74 

5.828 

6.966 

52 

10.920 

13.653 

75 

5.584 

6.664 

53 

10.730 

13.382 

76 

5.341 

6.366 

54 

10.533 

13.105 

77 

5.102 

6.074 

55 

10.332 

12.823 

78 

4.867 

5.787 

56 

10.125 

12.537 

79 

4.635 

5.506 

57 

9.914 

12.246 

80 

4.409 

5.232 

58 

9.697 

11.950 

81 

4.187 

4.964 

59 

9.476 

11.650 

82 

3.971 

4.704 

60 

9.250 

11.347 

83 

3.761 

4.451 

61 

9.020 

11.040 

84 

3.556 

4.206 

62 

8.786 

10.731 

85 

3.359 

3.969 

63 

8.549 

10.419 

86 

3.168 

3.740 

64 

8.309 

10.105 

87 

2.983 

3.521 

65 

8.066 

9.789 

88 

2.805 

3.309 

66 

7.820 

9.472 

89 

2.637 

3.107 

67 

7.573 

9.155 

90 

2.474 

2.914 

68 

7.324 

8.838 

91 

2.318 

2.729 

69 

7.074 

8.621 

92 

2.170 

2.554 

70 

6.824 

8.206 

93 

2.030 

2.837 

71 

6.574 

7.892 

94 

1.895 

2.230 

72 

6.324 

7.580 

95 

1.765 

2.081 

PROCEDURE  IN  PREPARATION  OF  VALUATION. 

By  use  of  the  preceding  tables,  the  present  value  of 
the  various  benefits  equated  to  one  dollar  of  salary  were 
calculated  for  the  various  service  groups  of  teachers. 
A  4%  interest  rate  was  assumed.  These  values  were 
multiplied  into  present  salaries  of  teachers  and  the  re- 
sults combined  to  form  the  present  value  of  all  benefits 
payable  to  teachers. 

The  valuation  of  contributions  to  be  received  from 
present  members  of  the  Teachers'  Retirement  Fund  in- 
volved more  complex  calculations  than  did  any  of  the 
benefit  provisions.  Members  of  the  Retirement  Fund  are 
required  to  have  contributed  a  certain  percentage  of  the 
first  year's  annuity  before  they  are  eligible  to  retire.  To 
value  the  increase  in  the  income  of  the  fund  which  would 
result  from  provisions  of  this  type,  the  following  general 
methods  were  employed. 

First  a  summation  column  was  made  on  the  salary  scale 
and  then  several  curves  were  drawn  on  cross  section 
paper  showing  various  percentages  of  it,  such  as  1%,  2%, 
3%,  etc.  The  figures  formed  by  dropping  ordinates  from 
the  ends  of  each  of  the  curves  to  the  base  line  were  then 
cut  out  of  the  paper  and  used  as  templets.  A  certain  per- 
centage of  the  salary  scale,  generally  60%,  was  then  plot- 
ted on  co-ordinate  paper  of  the  same  graduation.  The  tem- 
plet showing  the  accumulations  at  2%  was  placed  on  the 
graph  showing  60%  of  the  salary  scale  in  such  a  way 
that  the  ordinate  on  the  graph  for  the  age  at  entrance 
of  a  contributor  at  its  point  of  intersection  with  the  base 
line  coincided  with  the  ordinate  for  the  same  age  at  its 
intersection  with  the  curves  of  the  templet.  Then  the 
templet  was  swung  at  this  point  as  an  axis  until  the  base 
line  of  both  curves  were  parallel  and  the  other  point  of 
intersection  of  the  two  curves  was  noted.  This  latter 
point  indicated  the  age  at  which  2%  of  any  salary  begin- 
ning at  the  entrance  age  and  accumulated  would  amount 
to  60%  of  the  salary,  if  the  salary  had  increased  ac- 
cording to  the  average  rates  of  increase  indicated  by  the 
salary  scales.  Using  the  age  thus  obtained,  the  value  of 
an  insurance  payment  of  60%  of  the  salary  payable  in  the 


'NEW 


JERSEY' 


23 


event   of   disability   during   the   term   prior   to   this    age  When  the  maximum  limits  had  to  be  taken  into  account 

during  which  the  teacher  would  be  eligible  for  annuity  in  in  connection  with  the  procedure  previously  described,  the 

the  event  of  disability  was  calculated.     Then  the  value  of  work  became  somewhat  complex  and  tedious, 

returning  to  teachers  disabled  during  the  same  term  the  In  the  retirement  system  proposed  by  the  Pension  and 

total  amount  of  their  accumulated  contributions  without  Retirement  Fund  Commission,  the  benefit  and  contribu- 

interest  was  calculated.     The  difference  between  the  two  tion  Provisions  are  so  adjusted  as  to  be  readily  valued, 

amounts  thus  obtained  gives  the  additional  amount  to  be  AGE  DISTRIBUTIONS  USED  AS  A  BASIS  FOR 

received  by  the  fund  on  account  of  this  limitation.  VALUATION. 

The  preceding  discussion  gives  an  account  of  the  gen-  The  age  distributions  of  the  teachers  that  were  con- 

eral  procedure  necessitated  in  the  calculations  by  reason  sidered  in  the  valuation  follow.     Tables  13  and  14  show 

of  the  single  feature  of  the  contribution  provisions.     The  the  age  distribution  of  all  teachers  in  the  state  who  are 

fact  that  annuities  are  limited  in  amount,  that  the  total  eligible   to   benefits   under   the   35-Year   Service  Pension 

contributions  of  teachers  are  limited  and  that  annuities  Act.     In  giving  them  credit  for  service,  prior  service  to 

are  based  on  60%  of  an  average  instead  of  the  final  salary  the  extent  of  ten  years  was  included  in  accordance  with 

all   served   to   make  the   calculations  more   complicated.  the  law  governing  the  benefits  of  this  system. 

Table  13 — The  Number  and  Salaries  of  Teachers  Classified  by  Age. 

Men  Teachers 

Towns  or  Cities  of  5,000 

'Ota'  Rural  Districts                                      Inhabitants  and  Upwards 

Age  Group                                 Number              Salaries  Number              Salaries                                 Number             Salaries 

18-22 67               $   56,860  39               $   31,340                               28               $    25,520 

23-27 220                  248,210  80                    82,350                             140                  165,860 

28-32 354                  510,700  95                  120,280                             259                  390,420 

33-37 328                  550,200  80                  105,300                             248                  444  900 

38-42 262                  506,730  75                  115,710                 -           187                  391  020 

43-47 215                  440,070  61                    84,420                             154                  355,650 

48-52 142                  304,300  46                    68,180                               96                  236  120 

53-57 105                  240,180  27                    38,760                               78                  201,420 

58-62 56                  125,100  26                    35,780                               30                    89,320 

63  and  over 47                 103,770  15                   19,890                              32                   83,880 

Total 1,796            $3,086,120  544               $702,010                         1,252            $2,384,110 

Women  Teachers 

18-22 1,965            $1,182,520  822               $473,600                         1,143            $     708,920 

23-27 4,401              3,166,980  1,438                  964,780                         2,963              2,202,200 

28-32 2,767              2,481,930  660                  514,050                         2,107              1,967,880 

33-37 1,773              1,797,490  344                  272,490                         1,429              1,525  000 

38-42 1,422              1,501,260  241                  199,430                         1,181              1,301,830 

43-47 945              1,036,380  175                  139,620                             770                 896  760 

48-52 654                  727,240  106                    83,640                             548                  643^600 

53-57 395                  452,850  66                    53,600                             329                 399  250 

58-62 181                  209,100  35                    26,090                             146                  183,010 

63   and  over 665                   82„630  11                     9,520                              54                   73,110 

Total 14,568         $12,638,380  3,898            $2,736,820                       10,670            $9,901,560 

Grand  Total 16,364         $15,724,500  4,442            $3,438,830                       11,922         $12,285,670 

Table  14 — The  Number  and  Salaries  of  Teachers  Classified  by  Years  of  Service. 

Men  Teachers 

Towns  or  Cities  of  5,000 

Total  Rural  Districts                               Inhabitants  and  Upwards 

Service  Group                                Number            Salaries  Number             Salaries                           Number             Salaries 

Less  than  5  years 374            $412,240  133            $128,040                         241            $284,200 

5  years  and  less  than  10....        383               569,700  99               127,940                         284              441,760 

10  years  and  less  than  15....        374               659,410  95               130,060                         279              529*.350 

15  years  and  less  than  20....        260               538,730  72               104,880                         188              433,850 

20  years  and  less  than  25....        181               395,900  60                 88,970                         121               306,930 

25  years  and  less  than  30....          89               208,880  29                 42,410                           60              166^470 

30  years  and  more 135               301,260  56                 79,710                           79              221,550 

Total 1,796         $3,086,120  544             $702,010                       1,252         $2,384,110 

Women  Teachers 

Less  than  5  years 4,885         $3,214,540  1,832         $1,138,650                      3,053         $2,075,890 

5  years  and  less  than  10....    3,531           2,928,160  977               721,280                      2,554           2,206  880 

10  years  and  less  than  15....    2,310           2,260,160  477              376,770                      1,833           1,883,390 

15  years  and  less  than  20....    1,517           1,602,150  263               212,320                      1,254           1, 389*,830 

20  years  and  less  than  25....    1,004           1,098,720  150               123,040                         854               975*680 

25  years  and  less  than  30....        633               709,720  88                 72,920                         545               636*800 

30  years  and  more 688               824,930  111                 91,840                         577               733*,090 

Total 14,568       $12,638,380  3,898         $2,736,820                     10,670         $9,901,560 

Grand  Total 16,364       $15,724,500  4,442         $3,438,830                     11,922       $12,285,670 

In   the  valuation   of   the   liabilities   and   contributions  tion  rates  payable.     The  following  tables  give  summaries 

of   the   Teachers'    Retirement   Fund,    the   teachers   were  of  the  groups  considered.     In  these  tables,  only  service 

considered  according  to  the  classes  described  on  page  2.  in  New  Jersey  has  been  taken  into  account. 
Each  class  was  further  divided  according  to  the  contribu- 


24  'NEW  JERSEY' 

Table  15 — The  Number  and  Salaries  of  Contributors  to  the  Teachers'  Retirement  Fund  Classified  by  Age. 


Total 

Age  Group                               Number  Salaries 

18-22 1,990  $1,214,230 

23-27 4,584  3,390,200 

28-32 2,692  2,602,610 

33-37 1,393  1,589,570 

38-42 1,128  1,354,130 

43-47 839  1,070,830 

48-52 642  813,470 

53-57 423  567,560 

58-62 215  304,670 

63   and  over 100  168,660 

Total 14,006  $13,075,930 

Contributing  1% 125  $164,820 

Contributing  2% 12,230  10,810,480 

Contributing   2  %■%... .        947  1,127,280 

Contributing  3% 704  973,350 


Men  Coi 

itributors 

Number 

Salaries 

64 

$    54,410 

215 

244,360 

331 

479,880 

244 

404,320 

160 

309,990 

137 

280,690 

101 

199,620 

71 

155,950 

46 

108,400 

41 

92,470 

1,410 

$2,330,090 

11 

$       28,090 

1,142 

1,754,080 

98 

185,820 

159 

362,100 

Women  Contributors 


Number 

Salaries 

1,926 

$1,159,820 

4,369 

3,145,840 

2,361 

2,122,730 

1,149 

1,185,250 

968 

1,044,140 

702 

790,140 

541 

613,850 

352 

411,610 

169 

196,270 

59 

76,190 

12,596 

$10,745,840 

114 

$     136,730 

11,088 

9,056,400 

849 

941,460 

545 

611,250 

In  the  valuation  of  the  proposed  plan,  an  estimate  of 
the  maximum  liabilities  of  the  state  was  sought.  It  was 
therefore  assumed  that  all  teachers  in  the  state  would 
take  advantage  of  the  benefits  of  the  system,  and  that 
members  of  the  Teachers'  Retirement  Fund  would  trans- 
fer to  the  system.     The  tabulations  shown  in  tables  13 


and  14  therefore  give  the  age  and  service  distributions 
employed  in  the  valuation  of  the  plan  of  reorganization. 
The  valuation  of  benefits  payable  to  present  annuitants 
under  the  Teachers'  Retirement  Fund,  and  pensions  to 
pensioners  under  the  35-Year  Service  Pension  Act  was 
based  on  the  age  distribution  shown  in  tables  17-19. 


Table  16 — The  Number  and  Salaries  of  Contributors  to  the  Teachers'  Retirement  Fund  Classified  by  Service. 


Service  Group  Number 

Less  than  5  years 6,217 

5  years  and  less  than  10....  3,703 

10  years  and  less  than  15....  1,214 

15  years  and  less  than  20....  881 

20  years  and  more 1,991 

Total 14,006 


Total 


Salaries 
$4,663,890 
3,536,280 
1,355,550 
1,057,500 
2,462,710 

$13,075,930 


Men  Contributors 
Number             Salaries 

590             $757,870 
394               700,080 
136                256,420 
105               221,180 
185               394,540 

Women 
Number 

5,627 
3,309 
1,078 
776 
1,806 

Contributors 
Salaries 

$3,906,020 

2,836,200 

1,099,130 

836,320 

2,068,170 

1,410         $2,330,090 

12,596 

$10,745,840 

Table  17 — Age  Distribution,  Number  and  Retirement  Allowances  of  Retired  Teachers  Who  Receive  Renefits  From 
Both  the  35- Year  Service  Pension  Fund  and  the  Teachers'  Retirement  Fund. 


Men  Teachers 

\ 

Women  Teac 

jhers 

Men  Teachers 

Women  Teachers 

Amount 

Amount 

Amount 

Amount 

Amount 

Amount 

Amount 

Amount 

Num- 

of 

of 

Num- 

of 

of 

I 

dum- 

of 

of 

Num 

of 

of 

Age 

ber 

Annuities 

Pensions 

ber 

Annuities 

Pensions 

Age 

ber 

Annuities 

Pensions 

ber 

Annuities 

Pensions 

38 

1 

$    650 

$    710 

68 

4 

2,200 

3,660 

14 

7,810 

6,830 

39 

69 

2 

1,050 

870 

13 

5,720 

5,060 

40 

70 

2 

1,300 

2,140 

10 

5,470 

6,190 

41 

71 

4 

2,120 

2,550 

7 

3,490 

3,990 

42 

72 

3 

1,250 

1,050 

7 

3,540 

3,740 

43 

73 

2 

1,000 

1,290 

15 

7,560 

8,960 

44 

74 

2 

900 

1,020 

4 

1,690 

1,730 

45 

75 

3 

1,900 

2,690 

8 

3,570 

3,320 

46 

76 

2 

1,300 

1,930 

5 

2,310 

2,590 

47 

1 

380 

390 

77 

3 

1,360 

2,110 

4 

2,170 

2,960 

48 

78 

49 

79 

1 

320 

320 

2 

520 

530 

50 

80 

1 

650 

1,500 

1 

250 

170 

51 

81 

2 

1,300 

2,930 

52 

82 

53 

83 

54 

2 

900 

860 

84 

1 

590 

750 

1 

350 

260 

55 

4 

2,160 

2,130 

85 

1 

650 

920 

56 

1 

$     650 

$     600 

9 

5,080 

4,530 

86 

1 

650 

1,080 

57 

14 

7,850 

7,940 

87 

58 

3 

1,668 

1,610 

13 

7,600 

7,150 

88 

59 

4 

2,340 

2,220 

14 

8,210 

8,340 

89 

60 

3 

1,950 

2,230 

22 

13,700 

13,410 

90 

61 

7 

3,740 

3,710 

19 

10,640 

9,930 

91 

62 

2 

820 

680 

19 

9,810 

9,020 

92 

63 

5 

2,780 

2,600 

17 

9,220 

8,870 

93 

64 

8 

4,150 

4,630 

16 

9,400 

9,300 

94 

65 

16 

8,390 

7,620 

95 

1 

610 

480 

66 

3 

1,050 
2,330 

950 
2,880 

13 

6,880 
8,440 

6,260 
7,170 

67 

5 

16 

Total 

75 

$40,020 

$48,920 

288 

$154,370    ! 

£150,440 

'NEW 


JERSEY' 


25 


Table  18 — Age  Distribution,   Number  and  Annuities   of 

Teachers  Retired  Under  the   Teachers'   Retirement 
Fund  Who  Receive  No  Retirement  Allowances  From 

the  State  35- Year  Service  Pension  Fund. 

Men  Teachers  Women  Teachers 

Amount  of  Amount  of 

Age                            Number  Annuities  Number  Annuities 

42 1  $     470 

43 

44 1  650 

45 1  $    280  1  300 

46 1  640  6  3,030 

47 1  650  5  2,070 

48 3  1,100 

49 1  310  5  2,320 

50 1  570  6  2,620 

51 1  320  2  1,300 

52 6  2,680 

53 7  3,190 

54 1  450  6  2,770 

55 1  560  6  2,170 

56 1  320  5  2,530 

57 3  1,200  6  2,290 

58 2  810  8  3,670 

59 2  930  7  2,880 

60 4  1,500  12  4,270 

61 12  4,100 

62 2  1,300  6  2,360 

63 1  650  6  2,440 

64 3  1,900  3  860 

65 2  840  4  1,580 

66 2  1,000  4  1,620 

67 2  900  5  1,370 

68 2  500  8  2,840 

69 1  650  7  2,420 

70 1  250  6  2,640 

71 2  890 

72 2  1,090  6  1,820 

73 1  250  3  1,150 

74 1  320 

75 1  250  1  270 

76 2  590 

77 1  650  3  820 

78 3  750  2  500 

79 3  1,290 

80 1  250 

81 

82 1  250 

83 

84 1  300 

85 1  500 

Total 45       $19,770  180  $71,240 


Table  19 — Age  Distribution,  Number  and  Pensions  of 
Teachers  Retired  Under  the  35-Year  Service  Pen- 
sion Fund  Who  Receive  No  Retirement  Allowances 
From  the  Teachers'  Retirement  Fund. 

Men  Teachers  Women  Teachers 

Amount  of  Amount  of 

Age  Number   Pensions  Number       Pensions 

53 1  $1,200 

54 1  $    460  1  300 

55 

56 1  320 

57 1  1,320  4  2,090 

58 1  550  4  1,300 

59 1  900  1  710 

60 1  250  4  1,840 

61 

62 1  650  2  750 

63 1  1,150  1  740 

64 1  650  1  300 

65 1  240  4  2,450 

66 1  3,040 

67 1  1,500  2  710 

68 1  310 

69 3  2,340  1  830 

70 3  2,410 

71 2  1,320  1  290 

72 i 

73 

74 

75 2  1,350 

76... 

77 

78 1  920 

79 l  300 

80 

81 

82 1  350 

83 

84 

85 

86 

87 

88 

89 

90 

91 

92 

93 

94 l  270 

Total 19       $15,910  35  $18,200 

VALUATION  BALANCE  SHEET 

The  following  valuation  balance  sheets  show  the  liabil- 
ities involved  in  the  operation  of  the  retirement  plans 
under  consideration. 


Table  20 — Teachers'  Retirement  Fund.     Valuation  of  the  Assets  and  Liabilities  as  of  June  SO,  1918. 

LIABILITIES  ASSETS 

Present  value  of  annuities  to  teachers  now  on  Funds  in  hand $       485,000 

the  retired  list:  Future    contributions    to    be    received    from 

Men  teachers $    460,624  present  teachers: 

Women  teachers 2,170,774  Men  teachers: 

1%       contributors $        2,461 

Total  Benefits  to  present  annuitants $   2,631,398  2%        contributors 599,619 

Present  value  of  annuities  to  be  paid  present  2%%   contributors 38,679 

active  teachers  who  hereafter  become  in-  3%       contributors 87,285 

capacitated:  Women  teachers: 

Men  teachers $   1,590,496  1%        contributors 13,107 

Women  teachers 14,839,771  2%       contributors 2,613,732 

m  .   .   ,         ti.  .  ._  .  2%%   contributors 244,770 

Total  Annuities  to  be  paid  to  prospective  an-  3%        contributors                     154  764 

nuitants  among  present  active  teachers 16,430,267  ' 

Total     future     contributions     from     present 

teachers  3,754,417 

Total  assets $   4,239,417 

Deficiency 14,822,248 

Grand  Total $19,061,665  Grand  Total $19,061,665 


26  'NEW  JERSEY' 

Table  21 — Teachers'  35  Year  Service  Pension  Act.     Valuation  of  the  Assets  and  Liabilities  as  of  June  30,  1918. 


LIABILITIES 
The  present  value  of  pensions  to  present  pen- 
sioners: 

Men  teachers $     463,478 

Women  teachers 1,677,371 

Total  benefits  to  present  pensioners $   2,140,849 

The  present  value  of  pensions  to  be  paid  pres- 
ent teachers  who  will  receive  benefits: 

Men  teachers  in  cities $   3,249,884 

Men  teachers  in  rural  districts         978,224 

Women  teachers  in  cities 13,927,058 

Women  teachers  in  rural  dis- 
tricts        2,833,197 

Total  benefits'  to  present  teachers 20,988,363 

Grand  Total $23,129,212 


ASSETS 
Contributions  to  be  made  by  state $23,129,212 


$23,129,212 


NOTE — Table  22  shown  in  Part  I,  page  12. 

RATES     OF     CONTRIBUTION     REQUIRED     OF     EN- 
TRANTS  UNDER   THE   EXISTING  RETIREMENT 
AND  PENSION  SYSTEMS. 

The  preceding  tables  take  into  account  only  the  liabil- 
ities involved  in  the  operation  of  the  plans  for  present 
teachers.  In  addition,  for  each  new  entrant,  a  certain 
percentage  of  salary  should  be  contributed  to  provide 
for  the  liabilities  added  to  the  fund  by  new  entrants. 
The  following  tables  give  these  rates  of  contribution. 
Table  23  shows  the  rates  that  should  be  contributed  by 
new  members  entering  the  Teachers'  Retirement  Fund, 
if  they  are  to  provide  their  proportionate  share  of  the 
funds  to  be  used  for  the  benefit  of  those  who  become 
disabled.  Table  24  gives  the  rates  which  would  be  re- 
quired of  the  state,  in  behalf  of  teachers  entering  under 
the  35  Year  Service  Pension  Act. 

Table  23 — Teachers'  Retirement  Fund.  Rates  of  Contri- 
butions Which  Would  Be  Sufficient  If  Paid  By  the 
Teacher  From  the  Time  the  Teacher  Enters  the  Service 
and  Up  to  the  Time  of  Retirement,  to  Meet  the  Cost 
of  the  Annuity. 

WOMEN 

(Percentage 

of  Salary) 

4.50 
4.51 
4.53 
4.55 
4.56 
4.57 
4.53 
4.50 
4.46 
4.43 
4.42 
4.40 
4.35 
4.29 
4.19 
4.04 
4.18 
4.35 
4.50 
4.68 
4.83 


AGE 

MEN 

At  Entrance  Into 

(Percentage 

the  Service 

of  Salary) 

20 

2.12 

21 

2.10 

22 

2.07 

23 

2.06 

24 

2.04 

25 

2.02 

26 

2.01 

27 

1.99 

28 

1.99 

29 

1.98 

30 

1.99 

31 

2.03 

32 

2.06 

33 

2.10 

34 

2.13 

35 

2.18 

36 

2.26 

37 

2.34 

38 

2.43 

39 

2.53 

40 

2.66 

Table  24 — Teachers'  35  Year  Service  Pension.  Rates 
of  Contributions  Which  Would  Be  Sufficient,  If  Paid 
By  the  State  From  the  Time  the  Teacher  Enters  the 
Service  and  Up  to  the  Time  of  Retirement,  to  Meet 
the  Cost  of  the  Pension. 

WOMEN 

(Percentage 

of  Salary) 

3.51 
3.50 
3.49 
3.48 
3.47 
3.46 
3.44 
3.43 
3.41 
3.40 
3.39 
3.37 
3.33 
3.26 
3.17 
3.02 
3.20 
3.42 
3.66 
3.91 
4.19 

RATES  OF  CONTRIBUTION  UNDER  THE  PROPOSED 
PLAN  OF  REORGANIZATION. 

The  rates  of  contribution  required  of  teachers  under 
the  proposed  plan  are  shown  in  Part  I,  page  4.  The  table 
gives  not  only  the  rates  applicable  to  new  entrants  into 
the  school  system  but  shows  the  rate  which  would  be 
payable  by  teachers  now  in  the  system  who  elect  to  enter 
the  proposed  system.  A  present  teacher  entering  the 
proposed  retirement  system  will  pay  the  rate  shown  as 
of  her  age  at  the  time  she  comes  into  the  new  system 
(not  the  rate  applicable  to  the  age  at  which  she  originally 
began  teaching).  The  state  will  make  up  for  the  teacher 
the  benefits  which  are  allowable  on  account  of  her  previ- 
ous service. 

The  rates  payable  by  the  State  to  meet  half  of  the  cost 
of  retirement  allowances  for  new  entrants  and  for  future 
services  of  present  teachers  are  shown  in  Part  I,  page  4. 
In  addition  the  state  must  make  special  contributions  to 
meet  the  total  cost  of  allowances  for  past  services  of 
present  teachers. 


AGE 

MEN 

At  Entrance  Into 

(Percentage 

the  Service 

of  Salary) 

20 

3.78 

21 

3.70 

22 

3.63 

23 

3.56 

24 

3.49 

25 

3.42 

26 

3.35 

27 

3.28 

28 

3.21 

29 

3.15 

30 

3.10 

31 

3.09 

32 

3.08 

33 

3.07 

34 

3.06 

35 

3.05 

36 

3.19 

37 

3.36 

38 

3.55 

39 

3.77 

40 

4.01 

'NEW  JERSEY'  27 

PENSION  REPORTS  AND  BULLETINS 

PUBLISHED  BY  THE 

BUREAU  OF  STATE  RESEARCH 

OF  THE 

NEW  JERSEY  STATE  CHAMBER  OF  COMMERCE 

Preliminary  Report  of  the  Pension  and  Retirement  Fund  Commission 

State  Research.  Consecutive  number  9,  191 8.  20  p.  Covers  the  retirement  systems  for  teachers, 
police,  firemen,  and  other  local  employees. 

Supplementary  Report  of  the  Pension  and  Retirement  Fund  Commission 

State  Research.  Consecutive  number  8,  191 8.  16  p.  Contains  a  digest  of  the  bill  for  the  retire- 
ment of  employees  of  the  State  of  New  Jersey  and  an  estimate  of  cost  of  the  proposed  system. 

Introducing  Order  into  Chaos 

Legislative  Index,  Vol.  15,  No.  8,  March  25,  1918.  A  review  of  what  has  been  accomplished  by 
six  months  of  investigation  of  pension  and  retirement  funds  and  what  must  be  done  in  the  future. 

Teachers'  Retirement  Systems  in  New  Jersey,  Their  Fallacies  and  Evolution 

State  Research,  Consecutive  numbers  10  and  12.  1918.  Report  of  the  Bureau  of  State  Research 
prepared  by  Paul  Studensky,  Supervisor  of  the  Pension  Staff.  In  3  parts.  19 18.  88  p.  Intro- 
duction and  Part  I,  Evolution  of  the  Systems.  Parts  II  and  III,  Present  Condition  and  Practical 
Remedies.  40  p.  Contains  besides  the  discussion  of  the  retirement  situation  in  New  Jersey,  a 
chapter  on  the  fundamental  principles  of  a  sound  retirement  system. 

Introduction  to  the  Report  on  the  Teachers'  Retirement  Systems  in  New  Jersey,  Their  Fallacies  and 
Evolution 

A  reprint.     16  p.  pamphlet. 

Police,  Firemen's  and  Other  Local  Employees'  Pension  Systems  in  New  Jersey 

State  Research.  Consecutive  number  11,  1918.  24  p.  Report  of  the  Bureau  of  State  Research 
prepared  under  supervision  of  Mr.  Paul  Studensky.  Chapter  on  methods  of  financing  and  condi- 
tion of  the  funds,  by  Mr.  Alexander  Gourvitch.  Chapter  on  development  of  legislation  and  charac- 
ter of  benefits  provided,  by  Mr.  R.  K.  Bissell. 

A  Sound  Municipal  Pension  Act  and  Central  Supervision  of  All  Pension  Funds  in  New  Jersey 

'New  Jersey,'  Vol.  VI,  No.  1,  October,  1918.  8  p.  By  Paul  Studensky,  Supervisor  of  the  Pension 
Staff  of  the  Bureau  of  State  Research.  An  outline  and  discussion  of  the  features  of  the  bill  pro- 
posed by  the  New  Jersey  Pension  and  Retirement  Fund  Commission. 

Reorganization  of  New  Jersey  Teachers'  Pension  and  Retirement  Systems 

State  Research.  Consecutive  No.  13,  1919.  Report  of  the  Pension  and  Retirement  Fund  Commis- 
sion of  the  State  of  New  Jersey.  January,  1919,  24  pages.  Part  I.  Present  Systems  and  Their 
Reorganization — A  critical  and  constructive  study.  Part  II.  Contents  of  Proposed  Legislation — 
An  act  providing  for  the  establishment  of  a  new  fund  on  an  actuarial  basis.  Part  III.  Actuarial 
Estimates — Cost  of  existing  systems  and  of  proposed  plan. 


v«vium  Bros. 

Makers 

Syracuse,  N.  Y 

W.  JAN  21  1908 


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